GDAX, the cryptocurrency exchange run by Coinbase, has added margin trading to the platform.
Eligible traders can now trade up to 3X leveraged orders on Bitcoin, Ethereum and Litecoin order books.
If you’re unfamiliar with trading and exchanges, margin trading is when you borrow money from your broker to buy or sell more stock than you can afford.
By buying or selling on margin, traders can increase their leverage and buying power, potentially generating profits beyond what their own cash balance would have supported.
This feature is mainly geared toward institutional investors.
That’s because Coinbase has launched the feature attempting to fit within the boundaries of the Commodity Exchange Act.