Leverage is the multiplier you choose when you open a perps position. It lets you control a larger position than the USDC you put up as collateral. At 10x leverage, 100 USDC of collateral controls a 1,000 USDC position. The higher the multiplier you pick, the larger the position you can open with the same amount of collateral.
Leverage works in both directions. The same multiplier that scales up your gains also scales up your losses. If your 1,000 USDC position at 10x leverage moves 5% in your favor, you make 50 USDC, which is 50% of the 100 USDC you put up. If it moves 5% against you, you lose 50 USDC, which is 50% of your collateral. Every percent of price move on the underlying asset hits your collateral with the leverage multiplier baked in.
This is the same reason higher leverage puts your liquidation price closer to the market. At 40x leverage, a move of roughly 2.5% against you wipes out the collateral on your position. At 5x leverage, the price would have to move roughly 20% against you for the same outcome. Lower leverage gives the position more room to absorb price swings without crossing your liquidation level.
The maximum leverage you can choose depends on the asset. BTC supports up to 40x. ETH supports up to 25x. SOL supports up to 20x. Most altcoins support up to 10x. Inside that range, you can only pick whole numbers. 1x, 2x, 3x, 5x, 10x, 20x, and so on.
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