leverage is a multiplier that lets you control a position larger than your wallet. if you post 100 dollars of collateral at 10x leverage, you control a 1000 dollar position. price moves are amplified in both directions: a 1 percent move on the underlying becomes a 10 percent move on your collateral. leverage is the engine behind every perp trade, and the bigger the multiplier, the smaller the price move that wipes you out.
in plain english
leverage is borrowed firepower. you bring a little money, the protocol fronts you a much bigger position, and you keep all the gains and absorb all the losses on that bigger size. it does not make you smarter, it just turns the volume knob up on whatever your trade was going to do anyway.
how leverage maps to liquidation distance
a useful rule of thumb: your liquidation distance is roughly 100 divided by your leverage multiplier, in percent.
- 2x leverage: roughly 50 percent move against you wipes the position.
- 10x leverage: roughly 10 percent adverse move ends it.
- 50x leverage: roughly 2 percent adverse move.
- 100x leverage: roughly 1 percent adverse move.
- 500x leverage: roughly 0.2 percent adverse move.
why leverage exists
leverage exists because traders want exposure that is bigger than their wallet without depositing more capital. it makes capital-efficient hedging possible, and it makes small accounts able to express large views. it also makes blow-ups possible. both are baked in, and any honest perp protocol will tell you that.
how it shows up on uponly.win
uponly defaults to 75x to 500x leverage. you pick the multiplier before you rip, and the size of your collateral times that multiplier becomes the notional position routed to avantis on base. there is no margin call email and no leverage adjustment after the fact: you set it, you tap rip, and the trade runs. for more on the right way to size at this level, read max leverage trading 101.
common confusions
higher leverage does not mean higher expected return. it means higher variance per unit of collateral. a trader running 500x on 10 dollars and a trader running 5x on 1000 dollars are both holding the same 5000 dollar notional exposure, but the first one gets liquidated by a sneeze and the second one survives most candles. position size and leverage interact, and ignoring that is the most expensive mistake new traders make.
- leverage is a multiplier on exposure, not on edge.
- a 10x position with 100 dollars is the same notional as a 1x position with 1000 dollars.
- liquidation distance shrinks proportionally as leverage grows.
- fees, funding, and slippage all scale with notional size, not collateral.
see also
- liquidation price definition
- margin definition
- isolated vs cross margin
- perpetual future definition
- slippage in perps
ready to feel a leveraged perp instead of reading about one? open uponly and rip a small position at a leverage you can stomach losing.