Leveraged Tokens (LT) will eliminate this trade-off and allow users to safely use leverage without having to worry about liquidation risks and save effort when managing a leveraged investment position.
Although LT in the past time is widely known for its advantages, it is also extremely controversial and causes misunderstanding from users. Compared to traditional leveraged margin products, LT has much less profitability in the long term.
Despite these shortcomings, LT still receives a lot of attention from global users. So, Binance took action to fix the problems of existing tokens and launched Binance Variable Leveraged Tokens (BLVT).
What is Binance Variable Leveraged Tokens?
Binance Variable Leverage Tokens (BLVTs) - Binance Mobile Leverage Tokens - are designed to overcome the limitations users often encounter in traditional leveraged tokens. Unlike the existing LTs, BLVT does not maintain a “fixed” level of leverage. Instead, BLVT uses a mobile lever frame that ranges from 1.5x to 3x.
It can be traded on the Binance spot market and derives its value from the Binance Futures non-term BTC contract. Currently, there are two types of BLVT: BTCUP and BTCDOWN.
- BTCUP allows users to get a leveraged return of 1.5 to 3x as the price of Bitcoin increases.
- In contrast, BTCDOWN allows you to make money when the price of Bitcoin falls.
BLVT will track fluctuations in the estimated value of demand positions and changes in leverage.
More details visit here: https://vakafx.com/detail/the-ultimate-guide-to-Binance-leveraged-tokens
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