Leverage lets you control a position larger than the money you actually put in. The rest is borrowed from the exchange, and your own money sits underneath the trade as margin.

Think of buying a house with a mortgage. You pay 10% of the price yourself and borrow the other 90%. You control the whole house, but only a tenth of it is your money. If the house gains 10% in value, your own stake has doubled. If it loses 10%, your stake is wiped out and the loan still has to be repaid. A leveraged trade works the same way. The only difference is that it plays out in minutes instead of years.

In numbers: with 100 USDT and 10x leverage, you open a position worth 1,000 USDT. Every price move is calculated on the full 1,000, but every gain and every loss comes out of your 100.

It multiplies both directions by exactly the same amount. If Bitcoin rises 1%, you gain 10 USDT, which is 10% on your own 100. If it falls 1%, you lose 10%. Leverage is not tilted toward profit. It amplifies whatever the market does to you.

Liquidation is the moment losses have eaten through your margin and the exchange closes the position for you, automatically, to protect the money it lent. You do not get to hold on and wait for a recovery. The position is gone and so is the margin behind it.

The higher the leverage, the smaller the move that gets you there. Roughly, an adverse move of 100 divided by your leverage erases your margin.

• 2x
  about a 50% adverse move wipes you out
• 5x
  about 20%
• 10x
  about 10%
• 20x
  about 5%
• 50x
  about 2%
• 100x
  about 1%

So at 10x, a 10% move against you is a 100% loss. Bitcoin moving 5% in a single day is ordinary, which means that at 20x or higher one unremarkable day is enough. In practice liquidation arrives slightly before these numbers, because fees and the maintenance margin requirement are counted against you as well.

That is why beginners generally stay at the low end, somewhere between 1x and 3x, while learning to read a chart and manage a position. Low leverage buys you room to be wrong and time to close the trade yourself instead of having it closed for you. High leverage can take you out even when your view of the market was correct.

None of this is a suggestion to open a trade. Leverage is a setting you should understand before you touch it. Since this is mock trading, change the multiplier and watch how close the liquidation price moves each time. Learning it here costs you nothing.