Binance Margin Trading Service Stands as a Future Option

The giant cryptocurrency exchange Binance is reportedly preparing to onboard a margin trading service on its platform. That is said to have a riskier impact on digital trading assets more than it already has, report media outlets.

The article was updated on 30 December, 2019 by Amicus.

25 March, 2019, | AtoZ MarketsBinance will allow its retail customers to trade on the margin. And that stirs an atmosphere of touched dissatisfaction among the crypto community. Investors will trade on borrowed funds as a guarantee for the issuer. That means the transaction is subject to a greater risk.

Among the details of the news, That has not been confirmed yet. Using the margin feature will be conditional on holding the Binance Coin [BNB] – the native token of the exchange.

Earlier last week, a programmer on Reddit had discovered the margin trading feature on the Binance’s Application Programming Interface [API]. That “new” discovery made the cryptocurrency community believe that the exchange will schedule margin trading within its next update.

“This change did not reflect in the documentation. Further analysis of the respondents revealed that all 482 trading pairs have spot trading enabled and margin trading disabled; which makes sense. However, this API update implies that Binance is considering the implementation of margin trading features.”, said the programmer.

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Binance Margin Trading Service may Come Anytime in the Future!

On his turn, the CEO of Binance Changpeng Zhao clarified that the exchange had not included the margin trading on its platform yet. The idea may still stand for future application. Changpeng said:

“We future proof our API framework as part of our system upgrades. No dates.”

From a customer-protection perspective, regulators have always referred to that margin trading increases the risk of investment. In addition to the high risk, the important volatile assets like cryptocurrencies already pose. The SEC stressed earlier:

“The downside to using margin is that if the stock price decreases, substantial losses can mount quickly.”

Cryptocurrency exchanges tend to boost the options its investors have in margin trading, as an attraction factor, for which exchanges compete.

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