Leverage refers to using borrowed funds to trade cryptocurrencies or other financial assets, which enhances your ability to buy or sell. This allows you to trade with more capital than what is currently available in your wallet.
Leverage is described in ratios, such as 1:5 (5x), 1:10 (10x), or 1:20 (20x). It indicates how many times your initial capital is multiplied.
For example, suppose your trading account has $100, but you want to open a $1,000 Bitcoin (BTC) position. Using 10x leverage, your $100 will have the same buying power as $1,000.