Leveraged trading of cryptocurrencies — i.e., trading crypto with borrowed funds — comes with significant risks. This is mainly due to the capricious nature of the market.
In May, the cryptocurrency market, which had grown significantly over the past couple of years, recoiled violently following a cascade of negative market events, losing over 50% of its market cap. The pullback, which caused a jarring $2 trillion market wipeout, also exposed some of the market’s biggest weaknesses. One of them was the reckless use of leverage in a market that is historically mercurial.
This aspect was recently affirmed by billionaire investor Mike Novogratz. Novogratz, a fierce crusader for the industry at large and a once-ardent supporter of the Terra ecosystem before its downfall.
He recently acknowledged that he underestimated the amount of leverage in the market and the losses that this would bring.
"I didn't realize the magnitude of leverage in the system. What I don't think people expected...
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INN caught up with cryptocurrency investment expert Dan Hoover to review the current landscape and where the market may be heading. The cryptocurrency investment marketplace has gone through severa...