How do I short sell USDT?

Imagine you believe the price of BCH will decline from 400 USDT to 250 USDT. With 1 BCH in your possession, you can utilize the 5X leverage to borrow an additional 4 BCH. By doing so, you now have a total of 5 BCH to sell. You sell these 5 BCH at the current market price of 400 USDT each, generating a total revenue of 2,000 USDT.

However, you must remember that you borrowed 4 BCH to make this trade possible. When the price of BCH drops to 250 USDT, you will need to buy back these 4 BCH to close your position. At the new price, this will cost you 4 times 250 USDT, which equals 1,000 USDT.

In addition to the cost of buying back the borrowed BCH, you also need to consider the interest charged on the borrowed funds. This interest varies depending on the platform and can be significant over time. For simplicity, let's assume the interest in this example is 400 USDT.

Now, let's calculate your profit. You sold 5 BCH for 2,000 USDT and spent 1,000 USDT buying back the borrowed BCH. You also paid 400 USDT in interest. Subtracting these costs from your revenue, your profit is calculated as follows: 2,000 USDT - 1,000 USDT - 400 USDT = 600 USDT.

To sell short in margin markets, you need to understand the concept of leverage. Leverage allows you to borrow funds to increase your trading position, potentially amplifying your profits but also increasing your risks. Let's take BCH/USDT as an example. Suppose the maximum leverage allowed is 5X. This means you can borrow up to five times the amount of your initial investment.