How many times leverage to open on perpetual contracts is a question I’ve been asked many times over the past few years—since the last bull market, and now in this one. Newcomers are plentiful, and even seasoned traders have had their share of setbacks.

To be honest: leverage is not a printing press. It’s like a kitchen knife. When you’re chopping vegetables skillfully, it’s smooth; but a slight tremor can cause bloodshed.

The most attractive feature of perpetual contracts is that there’s no expiration date. As long as you don’t get liquidated, you can hold as long as you want. It sounds incredibly free. But behind this freedom are all kinds of pitfalls—being able to add positions at any time, wanting to chase profits when it’s up, holding on when it’s down. The fantasy of doubling your gains with leverage blinds you to the risks, which are often thrown far out of sight.

Last week, I met a trader who said he often used 30 to 50 times leverage. I joked and asked why he didn’t just go straight to 100 times. He rolled his eyes and said, “It blows up too fast, I can’t react in time.” I laughed then—basically, using leverage is like walking a tightrope. 50x is a slow cut, 100x is a quick slash. The difference is how many seconds the market gives you to react.

Take Bitcoin as an example: 30x leverage can’t withstand a 16-point move; at 50x, it’s down to 10 points; at 100x, it shrinks to just 5 points. 1x leverage is rock solid, but it earns very slowly; 100x is fierce like a tiger, but without proper stop-loss discipline, your account can be wiped out in minutes.

What truly pushes traders to liquidation isn’t high leverage per se, but reckless position sizing and margin management. Thinking you can turn a few hundred dollars into thousands of profit, and then getting shaken out by a slight market wobble. The most painful part is when you see the right direction but, because of over-leveraging, get washed out by a small fluctuation, only to watch the market rise afterward.

Remember this: perpetual contracts aren’t afraid of high leverage; they’re afraid of leaving no room for your account to breathe. The margin must be able to withstand normal market fluctuations—that’s the bottom line.

I’ve summarized three iron rules that have kept me alive all these years:

**First, only use isolated margin; never use cross margin.** Cross margin is like tying your entire fortune to a bundle of dynamite—one careless move, and it’s all gone.

**Second, always set a stop-loss.** When you open a position, the countdown to liquidation begins. Without a stop-loss, there’s no bottom line.

**Third, don’t be too greedy with your targets.** Making 50 to 100 dollars daily on a 5000-dollar capital may not seem like much, but compounding it beats gambling once in a million.

Leverage amplifies not the market, but your greed and discipline. A trader who can control risk at 100x is much safer than one recklessly holding at 5x.

Perpetual contracts are never about how brave you are; they’re about how long you can survive. A reliable system and solid risk management are the keys to walking away with a smile.