Leverage

Borrowing to bet bigger - and how a liquidation cascade wipes you out.

What it means

Leverage means trading with borrowed funds to size a position larger than your own capital. 10x leverage turns a 10% move into a 100% gain or loss. It amplifies both directions equally and adds a liquidation price at which your position is force-closed.

Why it matters for scams

On a low-liquidity token, leverage is a fast way to get rekt even without an outright scam. A small price drop hits your liquidation level, your position is sold into a thin pool, and the forced sell pushes the price down further - triggering more liquidations. Scam projects sometimes advertise leverage or perps to pull in bigger deposits before pulling the rug.

How RektRadar helps

RektRadar focuses on the underlying token's safety - liquidity depth, sell-ability, and ownership - which is exactly what decides whether a leveraged position can be exited or gets trapped. A token that fails those checks is one you should never lever into.

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