Headquartered in Hong Kong, Bitfinex, the leading cryptocurrency trading and exchange platform has announced that it will increase leverage for its Tezos trading pairs to enhance the customer experience in a big way. The new changes shall be applicable from February 17, 2020.
The highly acclaimed cryptocurrency exchange announced the news about the enhancements through its official Twitter handle.
We have updated margin trading on @Tezos!
— Bitfinex (@bitfinex) February 17, 2020
With the recent upgradation of margin trading on Tezos pairs namely XTZ/USD and XTZ/BTC, the investors will now be allowed to trade with a reduced initial equity of 30% which was rolling at 50% earlier, lower margin maintenance which has been reduced from 25% to 15% as well as will be exposed to a higher maximum leverage of 3.3x instead of earlier leverage rate of 2x. Tezos currency can now be held as collateral for margin trading with a lower haircut of 30%. The earlier lower haircut limit was set at 50%.
According to Paolo Ardoino, CTO of Bitfinex stated that the strategic decision to infuse higher leverage for Tezos pairs is because of the strong trust that market investors have bestowed upon the popular cryptocurrency.
“[Tezos] is becoming a well established and liquid market on Bitfinex. [Thus, it is] time to switch gears and allow increased leverage to 3.3x,” quoted Ardoino.
Interestingly, the latest news can be seen as a trigger or a booster for the Tezos cryptocurrency network, which is currently going through a retracement phase. A high leverage trading exposes the investors to potential losses as well as opens doors for potential profits for them. Therefore, the increased leverage by Bitfinex exchange is likely to increase the volume of buying orders for Tezos which can eventually lead to a surge in the currency’s price.
In 2019, Bitfinex allowed margin trading on Tezos pairs (XTZ/USD and XTZ/BTC) and Stellar pairs (XLM/USD and XLM/BTC) on its network.