Have you ever wanted to short crypto on Binance but didn't know how? Or have you ever wondered what shorting is? Well, today's your lucky day because I'm going to explain what shorting is and show you exactly how to short on Binance.
So what exactly is shorting? Shorting is when you first borrow whatever you intend to sell. You then sell it on the open market. Lastly, you buy back the intended thing you sold at for (hopefully) a cheaper price. You would then profit the difference between what you sold it for and what you bought it back for. In essence, you're still buying low and selling high but the order is reversed and there's another step involved (borrowing). Now that you know what it is, why would anyone want to short?
Shorting can be used for a couple of reasons. The first is that you believe the price will go down and want to profit from the price drop. The second is that you want to hedge a position in a an open long position but don't necessarily want to close out the whole thing. The third, and this one is crypto specific, is that you want to lock in a certain sell price of some crypto that you currently hold but is on an external wallet which you will then send to an exchange to pay back.
I would say that those are the majority of reasons as to why people short crypto.
I do however want to say that shorting crypto is for the more experienced. You can definitely lose your whole bank roll if you don't know what you're doing or if you're new to it. Risk management is key when trading and it's especially true with shorting. Having said that disclaimer though, I think that shorting can be a good tool in your trading belt.
Now that you understand what shorting is and why people do it, here's a detailed 9 minute video on how to short crypto on Binance.
SAVE 10% ON YOUR TRADE FEES ON BINANCE
I hope that the video was able to better help you understand how you can short crypto on Binance.
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