Understanding Intellectual Leverage: A Revolutionary Approach to Derivative Trading

Trading with leverage on the crypto market carries significant risks, especially during extreme price fluctuations. Traditional derivative instruments often lead to liquidation even with small changes in market quotes. That is why an intelligent mechanism was developed to allow traders to work with higher leverage while protecting their investments from unexpected losses during settlement.

What is intelligent leverage and how does it differ from traditional tools?

Intelligent leverage is a comprehensive structured financial product designed to guide traders during periods of extreme market volatility. Unlike standard derivatives, this positioning mechanism allows users to place bets in one direction with maximum profit potential, using up to 200x leverage for certain cryptocurrencies.

The key difference is the protection against liquidation until settlement. In standard trading, a position with 100x leverage can be closed if the price drops by just 1%. With the intelligent mechanism, your initial investment remains protected throughout the trading period, regardless of how sharply the market fluctuates.

It should be noted that this product does not guarantee the return of the principal amount. However, it is structured to minimize unexpected force majeure losses and give traders more control over their positions.

Key advantages of structured leverage for active traders

Using intelligent leverage opens up several opportunities for experienced traders:

Significant profit amplification through high leverage. The mechanism allows increasing potential earnings with leverage up to 200x. This means that with correct market movement predictions, even a small initial investment can yield substantial profits.

Minimized risk of uncontrolled liquidation. Unlike traditional positions, your investment will not be liquidated due to microscopic price fluctuations. The position is maintained until the settlement period ends, giving traders time to wait for favorable market movements.

Flexibility in payout management. Traders can request early withdrawal of their earnings at any time before the end of the settlement period or stay in the position until the planned conclusion. This provides an additional level of control over their capital.

How does the mechanism work: how does intelligent leverage function during settlement?

Understanding how leverage works in this context is critical for success. The process consists of several key components:

Breakeven price — the reference point for calculations. This is a floating indicator calculated by the platform at the moment of order confirmation. For long positions, it always exceeds the entry price; for short positions, it is always lower. After order confirmation, this indicator becomes fixed and does not change throughout the position’s life.

Current market price — reflects the actual market state. This is a continuously updated indicator showing the current price of perpetual contracts at any trading moment.

Settlement price — the final value used to determine the outcome. It is calculated as the average index price of the derivative, taken every second over the last 30 minutes of the contract’s duration. This method ensures fair calculations and minimizes the impact of short-term price spikes.

Practical settlement scenarios for long positions

Let’s examine how payouts are calculated under different market conditions.

When the settlement price remains at or above the breakeven price, the trader makes a profit. The payout is calculated as: received amount = initial investment + [initial investment × leverage × (settlement price − breakeven price) / breakeven price]. Thus, you receive both your initial investment and the multiplied profit.

If the settlement price drops below the breakeven price, the payout is calculated differently. The calculated amount cannot be negative, so the minimum payout is zero. In this case, you may incur losses. In the worst scenario, the entire initial investment is lost, but no more, since it was your only committed amount.

Settlement scenarios for short positions

For short positions, the logic is mirrored. When the settlement price remains at or below the breakeven price, the payout formula is: received amount = initial investment + [initial investment × leverage × (breakeven price − settlement price) / breakeven price]. The trader profits when the market moves in the predicted direction.

If the settlement price rises above the breakeven price, a protective mechanism applies. The payout cannot fall below zero, so the minimum payout is zero. Potential losses are limited to the initial investment.

Practical example: trading trajectory with intelligent leverage

Let’s consider a specific case for better understanding. A trader opens a long position on BTCUSDT with the following parameters:

• Investment amount: 5000 USDT
• Entry price: 51,000 USDT per BTC
• Leverage: 100x
• Breakeven price: 52,000 USDT

Compared to traditional trading, this trader’s position with standard 100x leverage would be liquidated if BTC drops to 50,745 USDT. However, with the intelligent mechanism, the investment remains protected even during extreme fluctuations.

Let’s review four possible settlement scenarios:

Scenario 1: Sharp price decline. If BTC falls to 48,000 USDT, the calculation yields: max(5000 + [5000 × 100 × (48,000 − 52,000) / 52,000], 0) = 0. In this case, the trader loses the entire 5000 USDT investment but does not incur greater losses.

Scenario 2: Significant price increase. If BTC rises to 53,000 USDT, payout = 5000 + [5000 × 100 × (53,000 − 52,000) / 52,000] = 14,615.38 USDT. Profit is 9,615.38 USDT.

Scenario 3: Fluctuation with correction. BTC rises to 53,000, then corrects to 51,800 USDT. Payout = max(5000 + [5000 × 100 × (51,800 − 52,000) / 52,000], 0) = 3,076.92 USDT. Losses amount to 1,932.08 USDT.

Scenario 4: Decline and recovery. BTC drops to 47,000, then rises to 52,500 USDT. Payout = max(5000 + [5000 × 100 × (52,500 − 52,000) / 52,000], 0) = 9,807.69 USDT. Profit is 4,807.69 USDT.

These examples demonstrate how intelligent leverage functions under various market conditions.

Main risks and limitations: what you need to know

Despite its advantages, the product carries significant risks that traders must fully understand before use.

Intelligent leverage does not guarantee the return of the principal. If the settlement price drops significantly below the breakeven price, the entire investment can be lost. It is not a guaranteed financial instrument but a high-risk speculative product.

Additionally, early withdrawal is impossible if the payout is negative or zero. The product also stops accepting early withdrawal requests one hour before the scheduled settlement.

There is also a potential minimal difference—due to natural market fluctuations—between profit from early withdrawal and the final settlement, which does not exceed 0.5%.

Usage rules and experience control

Intelligent leverage is intended for traders willing to use high leverage and experienced in sharp market reversals. It is not designed for beginners or conservative investors.

Traders can choose between following the standard settlement schedule or opting for early withdrawal of profits. However, all earnings are calculated based on the final payout formula after the term ends.

Conclusion: when to use intelligent leverage

Intelligent leverage is a powerful tool for experienced traders aiming to maximize profits during high volatility periods while protecting themselves from unexpected liquidations. This leverage mechanism fundamentally changes the game in derivatives trading, allowing traders to stay in positions even during extreme market swings.

However, remember: this is a high-risk position. Use intelligent leverage only if you fully understand the underlying mathematics, are prepared to lose your entire investment, and have a clear risk management plan. For active traders meeting these criteria, this tool can open new opportunities in the crypto market.