Intermediate
Shorter Crypto: how to take a short position on the cryptocurrency market
Short or uncovered sale is trading strategy that allows traders to speculate on the drop in assets such as bitcoin or other cryptos . If you want to understand how Shorter in Crypto , what are the best trading platforms to open a short position and what are the risks and advantages of this method, this guide is for you. Find out how Bitcoin and other cryptocurrencies, even if you are starting out in crypto trading .
Table of contents
What is Shorter en Crypto?
Short as a cryptocurrency consists in selling an asset in the open that you do not have, in the hope of buying lower and making a profit on the price difference. This strategy, also called shorts selling , is widely used in cryptocurrency trading to take advantage of market reductions or cover against a brutal correction.
Short allows traders to bet on the drop in crypto rather than on its rise . This means that if the price falls, the short position becomes profitable: you can buy the cheaper crypto, repay your initial loan and pocket the difference. Shorter Bitcoin or other cryptos is therefore a way to downward market trends
Why Short Cryptos?
Why Shorter ? The uncovered sale of cryptocurrencies allows:
- Speculate on the drop in the price of an asset during the lower market.
- Protect yourself against market cuts if you already have cryptos (Hedging).
- Take advantage of advanced trading tools such as term contracts or CFDs to diversify your strategies.
- Perform profits even when the market is in negative trend.
Shorter 's strategy can amplify gains, but also losses. Traders must therefore understand the trading mechanisms on margin and leverage before getting started.
How does the uncovered sale of cryptocurrencies work?
The uncovered sale or trading shorts consists in borrowing a crypto (for example bitcoin ) from a trading platform or an exchange , to sell it immediately at the current price , then to buy later at a lower price to return the loan . The difference between the sale price and the buyout price constitutes the gain of the trader .
Simple example: You open a short position on Bitcoin at $ 40,000. If the price drops to $ 35,000, you buy the BTC and make a profit of $ 5,000 per Bitcoin. But if the price rises, losses can go up to your entire position.
Shorter Bitcoin and other cryptos: main methods
CFD (Contract for Difference) : CFDs are derivative financial instruments that allow the cryptos to have the underlying assets . You just bet on the rise or drop in price. CFDs are accessible via most online brokers , but they are sometimes prohibited or restricted in certain countries for individuals.
Tower contracts (future) : Term contracts are also derivative products . Here, you agree to buy or sell a cryptocurrency at a price fixed in advance, on a future date. They are available on many trading or decentralized platforms (such as dYdX or Drift ). They often offer a lever effect , but require a good understanding of the liquidation and margin mechanisms.
Options : the options give the right, but not the obligation, to buy or sell a crypto at a determined price before a given date. They allow you to speculate on the rise or the decline, or to cover yourself against market movements. The options offer great flexibility , but their operation is more complex and they are generally accessible on specialized platforms or for advanced users.
Margin trading (Margin Trading) : trading on margin is to borrow funds to open short (short) or long (long) positions with a lever effect . This increases the potential of earnings, but also losses. This service is offered by many crypto trading platforms (centralized or decentralized), but it requires rigorous risk management.
Products negotiated on the stock market (ETP/ETN) : ETP (Exchange Traded Products) or ETN (Exchange Traded Notes) are listed products on the stock market that replies the performance of a crypto . Some ETPs allow you to shift cryptos without opening account on a crypto platform, simply via your classic stock market broker They are accessible to most investors, but depend on local regulations and the products available on your market.
Shorter bitcoin and cryptos in France: what platforms to use?
Since 2023, the uncovered sale of cryptocurrencies via the term (future) contracts has been prohibited on Binance in France. French traders must therefore turn to alternative solutions to shiver cryptocurrencies advantage of the lever effect in a legal and decentralized manner.
Decentralized platforms: Drift and dYdX
The platforms like Drift and dYdX allow traders to bitcoin and other cryptos via perpetual contracts going through a centralized intermediary . These solutions work thanks to smart contract which automatically manage orders , leverage and liquidity .
How do smart contractwork in perpetual trading?
- Opening and management of positions : the trader opens a short or long position. The order is recorded on the blockchain via a smart contract .
- Lever and margin effect : platforms like Drift or dYdX allow you to use a lever (for example, 10x) to shunt or trader with capital higher than the initial bet. The smart contract permanently checks the available margin and liquid the position if the balance becomes insufficient.
- Automatic liquidation : If the market evolves against the trader , the smart contract closes the short position to limit losses .
- Financing rate (Funding Rate) : A period of periodic financing makes it possible to maintain the price of the contract close to the Spot price. Short traders pay or receive this rate depending on supply and demand.
- Liquidity management : platforms use liquidity pools or an off-chain order book (like dYdX ) to quickly execute orders .
- Safety and transparency : All transactions are recorded on the blockchain. The user keeps control of their portfolio and funds.
Why are these platforms an alternative to Binance Futures?
- They offer the same features: lever effect , shorts , trading , without central intermediaries.
- The DEFI guarantees more transparency, control over funds, and less risk of handling or blocking withdrawals.
- Secure trading and transparency of smart contract reassure experienced traders such as beginners .
Drift : a decentralized trading platform on Solana
Drift is a perpetual trading platform on Solana , Solana for its low costs and speed. For Shorter on Drift , simply connect your portfolio , place USDC USDC cryptocurrency pair . You can then open a short position with a lever effect up to 10x or more depending on the pairs.
- More than 50 pairs of available cryptos Bitcoin , ETH , Sol and many Solana .
- trading costs : –0.01 % for makers and 0.1 % for Takers, reduced thanks to the fuel program.
- Prediction market (BET) and performance options via liquidity or vaults.
- Reliable trading, rapid execution and decentralized management of positions .
For more details, see our detailed guide on Drift Protocol works .
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dYdX : the reference DEX for Shorter Bitcoin and Cryptos
dYdX is the most popular decentralized C platform trading of perpetual contracts. Initially on Ethereum , it now works on its own blockchain ( dYdX Chain) based on Cosmos, with a proof-of-stake model.
- More than 200 active perpetual markets, lever effect up to 50x on the main pairs of cryptocurrency .
- trading costs : 0.5 % max for takers, 0.1 % for makers, reduced via staking DYDX token .
- Rapid execution of orders , almost instant purpose and decentralized order book.
- Total control over funds via your portfolio and security provided by a network of independent validators.
For more information, see our article on how to use dYdX .
What are the risks in Shorter en Crypto?
Cryptocurrencies uncovered has major risks :
- Lever effect : it can amplify gains , but also losses. If the position evolves against you, you can lose all of your margin, or even more in the event of liquidation.
- Volatility: Price movements are sometimes extreme on the cryptocurrency , which can cause rapid liquidations.
- Trading costs: each transaction involves costs, which are added to the cost of the funding rate (Funding Rate).
- Technical risks: bugs in smart contract portfolio handling errors .
Beginners and traders must always manage their risk, use a lever effect , and never engage more capital than they can afford to lose .
Summary: How to Short Cryptos in 2025?
- Short or uncovered sale allows you to speculate on the drop in cryptocurrency like Bitcoin .
- To Shorter le Bitcoin and other cryptos , you can use CFDs , term contracts , options , or decentralized platforms like Drift and dYdX .
- Decentralized platforms offer reliable trading , without intermediary.
- Trading on margin and leverage make it possible to open short positions with limited capital, but Shorter can also increase losses.
- Stay attentive to trading costs , risk management, and market volatility.
By understanding the mechanisms of trading shorts , you can soer bitcoin and cryptos in a decentralized environment, transparent and adapted to today's traders Find out how to Short the Cryptos on Drift and dYdX , and take advantage of advanced trading tools make profits in all markets, upwards and downwards.
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Noah
Training engineer, I quickly became interested in the field of finance. Convinced that decentralized finance has a bright future ahead of it, I participate in its democratization by developing Crypternon.
