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Kraken Pro, the advanced trading platform of crypto exchange Kraken, has announced that $XRP is now available for margin trading against Ethereum ($ETH).
The list of $XRP pairs that are available for margin trading also includes $XRP/EUR, $XRP/$BTC, $XRP/CAD, and others.
How margin trading works
Margin trading makes it possible for traders to open larger positions by relying on borrowed funds.
The new pair allows betting on $XRP increasing in price against the flagship altcoin.
Traders can borrow funds in order to go long on $XRP. Conversely, they can also short the pair if they believe that $ETH will be able to outperform the Ripple-linked token.
Kaken allows users to trade with up to 5x leverage with the majority of available pairs. For $XRP/$ETH, however, leverage is capped at 3x. Leverage limits tend to vary due to such factors as liquidity and market volatility.
For instance, if a user deposits 5 $ETH as collateral, they can potentially open a position of up to 15 $ETH.
Kraken initially rolled out margin trading all the way back in 2015 with the $BTC/EUR pair.
Will $ETH outperform $XRP this year?
The $ETH/$XRP pair has plunged by more than 14% since its peak of 0.00096 $ETH that was logged on July 22.
Over the past week, $ETH is up by 1.9% while $XRP is down by 10.6%.
$XRP had been steadily gaining ground against $ETH since November. It reached its current year-to-date peak of 0.0114 $ETH in April. Back then, $ETH was in the middle of a rather severe sell-off.
However, the flagship altcoin has managed to bounce back, with Joseph Lubin's SharpLink helping to push a corporate adoption narrative.
