Bybit is considered the best cryptocurrency exchange for short selling. In cryptocurrency trading, profit is generated when the price rises and loss occurs when the price falls. However, you can avoid the risk by selling short. It is possible to earn more efficiently than general trading.
What is a short sale?
Short selling means placing a sell order regardless of whether you hold virtual currency or not. When placing a sell order, it is necessary to have a “virtual currency to sell”, but by depositing the margin first, you can place a sell order. Timing is very important as it will be repurchased when the price of the virtual currency falls. Selling short allows you to make a profit even if the price of an asset falls.
Advantages of short selling
The advantage of short selling is that you can make a profit. In general trading, you enter by selling or buying, and profit and loss are determined purely by the up and down of the value of the currency, but by using short selling properly in the market, you can make a profit more efficiently than general trading. . For example, you can make a profit by placing a buy order when the market is going up and short selling when the market is going down.
The advantage of short selling in a down market is that you can make a profit. Short selling starts from selling with the margin as collateral, and the difference is the profit after buying back at a lower price. In other words, there is a good chance that you can make money if you sell virtual currency short when the market is falling.
Leverage up to 100x
Bybit’s maximum leverage is 100x. High leverage means that you can trade even with a small amount of funds, so it is easy to make a profit. However, increasing leverage can also result in losses.
Zero cut system
The biggest advantage of short selling on Bybit is the zero cut system. A zero cut means that traders have no risk of going into debt. As long as you trade with Bybit, there is no risk of margin call.
Disadvantages of short selling
There are risks associated with short selling, and you should be aware of the following:
The risk of short selling is that it is difficult to make a profit in an uptrend. Short selling is a method of making money by taking advantage of falling prices, so it is not suitable for uptrends with strong buying pressure. Therefore, it is better to wait until the flow calms down. It would be best to wait until the price settles down to the daily level.
loss cut risk
Bybit has a stop-loss cut. Naturally, you cannot continue holding more funds than the margin deposit. When forced liquidation is executed, the trade ends and losses are fixed. If you think that the flow is clearly different, it is important to cut your losses and restart. Lower your leverage or set your own stop-loss line in advance.
short sale timing
As a mechanism of short selling, it is a trading method that aims for profit by holding a new selling position without holding virtual currency and buying it back later. In other words, the point is whether you can hold a sell position in advance and buy back when the market goes down. Conversely, losses occur in rising markets.
Do you recommend selling short?
Bybit is said to be relatively recommended for short selling among other virtual currency exchanges.
Maximum leverage 100 times
A maximum leverage of 100x is a very high leverage. Leverage can be used to generate profits more efficiently. Leverage can be easily set on the trading screen, and can also be changed after placing an order.
No margin call
There is no extra proof, so there is no cost. Since we have adopted a zero cut system, no matter how big the loss becomes, the loss will not exceed the margin. It means that you can challenge short selling with confidence even for the first time. However, transaction fees are charged not only for short sales, but also for virtual currency transactions.
Open an account for free
Bybit completes the registration process in about 1 minute, so you can easily open it. You can also open an account for free as it does not cost money. It also comes with a bonus.