Binance Leverage Token Quiz Answers 2022

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What is Binance Leverage Token?

Binance Leveraged Tokens are a form of derivative that allows you to gain leveraged exposure to the underlying asset. Leveraged tokens, just like all the other types of tokens, can be exchanged on the spot market. A basket of perpetual contract holdings is represented by each leveraged token. The price of a leveraged token fluctuates in tandem with the price of perpetual contracts, and the leverage level fluctuates as well.

Before trading, it is a must to be knowledgeable about leverage token trading is and therefore new users must complete a Binance Leverage Token Quiz.

Binance Leverage Token Quiz Answers

Binance Leverage Token Quiz Answers 2022

To be able to take the Binance Futures quiz, you must have access to the desktop version of Binance (binance.com).

Below is a list of all the questions and answers for the Binance Leverage Token Quiz.

1.) Binance Leveraged Tokens

Binance Leverage Token Quiz Question 1: What is Binance Leveraged Tokens?

Binance Leverage Token Quiz Question 1

Options:

  • Binance Leveraged Tokens is a financial derivative which is similar in nature to traditional leveraged ETFs. Their net asset value may be greatly worn out by short-term market fluctuations. Long term holding of Binance Leveraged Tokens is risky and users should minimise the losses by selling the leveraged tokens from time to time.
  • Binance Leveraged Tokens is a cryptocurrency which you can withdraw the tokens out anytime.
  • Binance Leveraged Tokens is a futures contract which you adjust leverage level from time to time.

Binance Leverage Token Quiz Question 11: Binance Leveraged Tokens is a financial derivative which is similar in nature to traditional leveraged ETFs. Their net asset value may be greatly worn out by short-term market fluctuations. Long term holding of Binance Leveraged Tokens is risky and users should minimise the losses by selling the leveraged tokens from time to time.

2.) Leverage Multiplier

Binance Leverage Token Quiz Question 2: What is the leverage multiplier for Binance Leveraged Tokens?

Binance Leverage Token Quiz Question 2

Options:

  • The system maintains a target leverage range between 1.25x and 4x
  • It is always 4x
  • It is always 1.25x

Binance Leverage Token Answer 2: The system maintains a target leverage range between 1.25x and 4x.

3.) Token Rebalance

Binance Leverage Token Quiz Question 3: When does Binance Leveraged Tokens rebalance?

Binance Leverage Token Quiz Question 3

Options:

  • Every 8 hours
  • Every day
  • When the market is volatile or the actual leverage multiplier is out of the target leverage range.

Binance Leverage Token Answer 3: When the market is volatile or the actual leverage multiplier is out of the target leverage range.

4.) Worst case scenario of holding Binance Leverage Tokens

Binance Leverage Token Quiz Question 4: What is the worst case scenario of holding Binance Leveraged Tokens on a long term basis?

Binance Leverage Token Quiz Question 4

Options:

  • Binance Leveraged Tokens is a good store of value and the value will increase over time.
  • Users can receive interest income for holding Binance Leveraged Tokens on a long term basis.
  • The value of Binance Leveraged Tokens can become zero (0) and cannot be recovered due to inherent market risks, high fees, slippage, rebalance algorithm frontrunning and any other perceived unknown risks associated with Binance Leveraged Tokens.

Binance Leverage Token Answer 4: The value of Binance Leveraged Tokens can become zero (0) and cannot be recovered due to inherent market risks, high fees, slippage, rebalance algorithm frontrunning and any other perceived unknown risks associated with Binance Leveraged Tokens.

5.) Binance Leverage Tokens Fees

Binance Leverage Token Quiz Question 5: Which one of these fees is NOT associated with Binance Leveraged Tokens?

Binance Leverage Token Quiz Question 5

Options:

  • Asset custody fees
  • Trading fees
  • Subscription and redemption fees

Binance Leverage Token Answer 5: Asset custody fees

6.) Cost associated with Binance Leverage Tokens

Binance Leverage Token Quiz Question 6: Which one of these is NOT a cost associated with holding Binance Leveraged Tokens?

Binance Leverage Token Quiz Question 6

Options:

  • Daily management fees and reflected directly in the net asset value of the Binance Leveraged Tokens.
  • Funding fees for basket positions and reflected directly in the net asset value of the Binance Leveraged Tokens.
  • Profit sharing fees

Binance Leverage Token Answer 6: Profit sharing fees

7.) Risk of holding Binance Leverage Tokens long-term

Binance Leverage Token Quiz Question 7: By trading Binance Leveraged Tokens, you do not need to maintain margin maintenance and worry about the liquidation risk. However, Binance Leveraged Tokens is not completely risk-free. Which one of these is NOT a risk associated with holding Binance Leveraged Tokens long-term?

Binance Leverage Token Quiz Question 7

Options:

  • Continuing to be charged management fees and funding fees.
  • Erosion of net asset value (NAV) due to rebalancing and volatility decay when there is no obvious trend in the market.
  • Receiving interest payment

Binance Leverage Token Answer 7: Receiving interest payment

8.) Subscription and Redemption of Binance Leverage Tokens

Binance Leverage Token Quiz Question 8: Why are subscription and redemption of Binance Leveraged Tokens not recommended during normal trading time?

Binance Leverage Token Quiz Question 8

Options:

  • Subscription and redemption fees are higher than trading fees and there is a limit on how many leveraged tokens users can subscribe or redeem daily.
  • Binance Leveraged Tokens is a cryptocurrency which you can withdraw the tokens out anytime.

Binance Leverage Token Answer 8: Subscription and redemption fees are higher than trading fees and there is a limit on how many leveraged tokens users can subscribe or redeem daily.

9.) Requirement for Binance Leverage Tokens

Binance Leverage Token Quiz Question 9: Which one of these actions is NOT required to complete before trading Binance Leveraged Tokens?

Binance Leverage Token Quiz Question 9

Options:

  • Opening a Margin Account.
  • Completing the Binance Leveraged Token questionnaire and agreeing to the terms and conditions in the Binance Leveraged Token Risk Disclosure.

Binance Leverage Token Answer 9: Opening a Margin Account

10.) Responsible Trader

Binance Leverage Token Quiz Question 10: What would a responsible trader likely do, if they incur consecutive losses?

Binance Leverage Token Quiz Question 10

Options:

  • Continue trading until they earn back their capital.
  • Cut losses timely and control risk exposure.

Binance Leverage Token Answer 10: Cut losses timely and control risk exposure.

11.) Understanding the trading activities

Binance Leverage Token Quiz Question 11: As a leveraged tokens trader, you should fully understand the risks associated with leveraged tokens trading and solely responsible and liable for any losses associated with trading activities on your account.

Binance Leverage Token Quiz Question 11

Options:

  • Yes, I agree
  • No, I disagree

Binance Leverage Token Answer 11: Yes, I agree

Conclusion

After accomplishing the quiz, you will now be able to start trading leverage tokens in Binance. Remember that leverage token is not available to be withdrawn.

Trading leveraged tokens come with its own set of fees. A 0.1 per cent subscription fee, a 0.1 per cent redemption fee, and a 0.01 per cent daily administration fee are included.

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Ross O'Sullivan

Ross is the co founder of Every Bit Helps YouTube channel & website. After hearing about Bitcoin back in 2013, Ross was initially put off thinking that he had missed his opportunity. However, in 2017 made his first purchase & now buys & holds his crypto long term, which make up a large part of his investment portfolio. While working as an IT project manager, he spent his spare time buying & refurbishing properties, which now runs as an Airbnb business back in the UK. Spending his early years traveling between Ireland and England, Ross continues to travel & lives abroad with his family.

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