Here are the top five Leveraged Tokens on Binance, based on year-over-year performance.
2020 has been an extraordinary year for crypto. As of now, cryptocurrencies have outperformed most traditional asset classes, as the entire crypto economy has grown by more than 180% since the start of the year. Notably, Bitcoin has outperformed Gold and US 10-Year Treasuries – assets that many expect to outperform in the unprecedented economic environment we are experiencing today. Bitcoin’s resilience during this crisis has positioned itself as the top performing asset class of 2020 so far.
This has resulted in massive demand for crypto leveraged tokens as investors seek to record huge profits in a short period of time. Leveraged tokens provide increased exposure (i.e. 2x or 3x) to the daily performance of the underlying crypto asset using various leveraged instruments such as swaps and futures contracts. Due to their dual effect, investors can enjoy higher returns in a very short time, as long as the trend remains positive.
Below, we highlight some leveraged tokens from different corners of the market that have grown over 100% in 2020. These funds will continue to be investors’ darlings as long as sentiment remains. optimistic.
Top 5 performing Binance Leveraged Tokens in 2020.
1. ETHUP – Up 290%
ETHUP is by far the best performing token on Binance, with a cumulative return of over 290% since its inception. This comes as no surprise as Ethereum is one of the best crypto assets to own this year, largely driven by the positive comments surrounding the ETH 2.0 upgrade and the rise in popularity. DeFi’s outstanding growth. As a result, ETHUP token has been one of the most profitable tokens to trade and generate outstanding returns. Two main trends have generated significant profits for ETHUP traders.
The first was when ETH crossed $500. Correspondingly, ETHUP rose from $27 to $41, up more than 50% from 32% in the spot market.
The second major trend occurred as ETH recovered from a strong pullback, where spot prices rose from $480 to $630, up more than 31%. Meanwhile, ETHUP has grown from $21 to $47, up more than 120% during the same period.
2. YFIUP – Up 264%
Another big mover is YFIUP. Yearn.Finance (YFI) is a decentralized finance (DeFi) platform with native governance tokens (YFI) used for voting rights and staking rewards for holders. Its market capitalization has more than doubled since August from just under $300 million to more than $750 million today. As a result, the YFIUP token has generated impressive returns since its inception in October. One of the highlights of YFIUP this year was when the token doubled in one day on May 17. 11, after a 30% increase in its underlying assets.
Much of YFI’s exponential growth has been mainly attributed to 4 key factors: limited supply, active and strong community, reputable development team, and innovative products.
3. XRPUP – Up 190%
XRPUP was an unexpected entry after going through years of inactivity. Its underlying asset, XRP, has revived from a multi-year slump after the price surged significantly more than 177%. XRPUP tokens have rallied more than nine times in three days, from a low of $10.75 to a high of $96.6. Undoubtedly one of the biggest short-term trends in Binance Leveraged Tokens. The rapid rise of XRPUP demonstrates the true power of the leveraged token as investors can generate outstanding returns in a fairly short time.
Many crypto advocates have criticized XRP and see the project as a very centralized operation no different from a traditional database. Despite these criticisms, XRP holders believe that the token will continue to rise as more corporations and financial institutions are starting to explore the crypto space.
4. BTCUP – Up 183%
Bitcoin has dominated the headlines in recent months as the price moves towards new all-time highs. Bitcoin’s recent stellar performance is no secret as the number of institutional investors attracted to the digital asset is likely to increase. As a result, the BTCUP token on Binance has performed remarkably well, with over 183% cumulative returns. BTCUP traders saw their biggest gains on November 30 when Bitcoin rallied more than 8% in a day to mark a new all-time high. Correspondingly, BTCUP tokens increased by 21% on the same day, providing outstanding returns for Bitcoin leveraged token holders.
5. LTCUP – 99% increase
Finally, LTCUP, which is the fifth best performing token on Binance, generates a cumulative gain of over 99% since September. Litecoin, which is closely correlated with Bitcoin, has had a phenomenal run based on that. on the success of Bitcoin. Are from Bitcoin Breakthrough above $12,000, Litecoin worked in tandem with the bellwether cryptocurrency, moving from under $55 to as high as $94 on Binance’s spot market. During the same period, the LTCUP token has grown from $12 to $34.8, a 190% increase from a 70% increase in its underlying asset.
Follow these 3 rules to capture strong short-term trends with leveraged tokens.
These are just a few examples of tokens that have generated great returns for their holders over the past few months. Leveraged tokens can be very powerful if you know when to enter and exit the market.
But don’t be mistaken. The cryptocurrency market can be a roller coaster ride. Past wins do not guarantee future profits. In markets that tend to have low volatility, leveraged tokens can outperform the returns of their underlying assets. However, in volatile markets, tokens may underperform due to the daily rebalancing and re-leverage mechanism embedded in leveraged tokens.
With that in mind, here are three rules that you should follow to maximize your winning potential in any leveraged token trade.
# first: Use leveraged tokens for short-term trades. If you hold leveraged tokens for too long, you are battling the potential negative effects of the token’s daily rebalancing, affecting your performance returns.
# 2: Focus on strong trending markets. Leveraged tokens work best in markets with strong trends and momentum. Make sure these factors work in your favor to increase the probability of profit in your trade.
#3: Use leveraged tokens to add visibility in your core portfolio. Leveraged tokens are not a substitute for holding assets on the spot market. However, they do provide additional options for traders to gain more exposure and profit in short-term trends.
Leveraged tokens can be very powerful for short-term trading, but you need to be cautious when holding these tokens for the long term. You must understand how leveraged tokens work in order to use the right tools for the job.
For more information on leveraged tokens:
Read: 4 Pitfalls of Leveraged Token Trading and How to Avoid Them
Read: Your Ultimate Guide to Binance Leveraged Tokens
For traders who are bullish on Bitcoin or any of the above crypto assets, leveraged tokens can be an interesting option. Trading short-term trends may appeal to those with a high tolerance for risk.
If you can predict price movements correctly, you will usually make money trading leveraged tokens. Tokens offer many viable alternatives to increase profits, put less trading capital at risk and profit with strong market dynamics.
While leveraged tokens are beneficial for short-term trading, it can also lead to large losses when the market is volatile or volatile. Furthermore, the performance of leveraged tokens can vary significantly from the actual performance of their underlying assets over a long period of time due to their dual effects. Therefore, users should avoid holding leveraged tokens for long periods of time.
Disclaimer: Binance does not take into account your personal investment goals, specific investment goals, specific needs or financial situation and makes no representations and is not responsible for the accuracy or the full range of information provided here. The information and publications are not intended to and do not constitute financial advice, investment advice, trading advice or any other advice or recommendation of any kind provided or endorsed by Binance. Binance also does not warrant that such information and publications are accurate, current, or applicable to particular circumstances.
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