A lot of people have made a lot of money on the rise of Dogecoin, thanks mostly to celebrities mentioning the coin at every opportunity. Those that missed the rocket to the moon, could have an opportunity to catch Dogecoin falling back to earth.
Let’s face it, the Dogecoin is going to go down at some point. When is the question and how fast will it drop are two of the biggest questions floating around the Internet? But the most important question to me is? Can I make money on the Dogecoin while it is crashing back down to earth?
The Dogecoin can be shorted
Disclaimer: I am not a financial advisor, nor do I claim to be one. I am not giving or offering financial advice. This post is about my experience of setting up a short position on Binance Futures. This post is also not about trading. This is betting and Binance Futures is the casino, and you are the poor sucker who will most likely lose your money, so be warned.
I was curious to find an exchange that allowed Dogecoin to be shorted and the Binance exchange has Binance Futures, which offer the solution. They do this through derivatives, which is betting on the future price. As this is betting and not trading, one can bet it will drop in price or rise to the moon. Binance Futures does offer some video tutorials, which I watched, but I still found it confusing, hence the instructions and screenshots below.
FYI: There are other exchanges that offer this service as well.
Some basic prerequisites for shorting the Dogecoin
- You need to be registered on Binance Futures. Some YouTubers offer referral codes, which come in handy.
- You need to have cash in your wallet or have some coins e.g. BTC, ETH, XRP etc.
Start here to short the Dogecoin
- From your Fiat and Spot Wallet, select the row (BTC or ETH or XRP or whatever coin you want to use) and click on the Convert link.
Note: For the sake of this how-to guide, I will be using some BTC coins in my screenshots.
2. In the From pulldown select BTC and in the To pulldown select USDT. One can enter in a BTC amount or click on the MAX to use everything in the BTC Wallet.
3. Click the Preview Conversion button.
Note: You will have 5 seconds to click the Convert button before the price conversion offer expires. You will then have to click the Refresh button to see the new price conversion.
4. If you are happy with the Conversion Price, click the Convert button. A brief In Progress Status appears followed swiftly by a Successful pop-up and you get the chance to View Status. The View Status will take you to the Trade History screen, where the BTC/USDT trade history can be found.
5. From the Menu at the top click on Derivatives and select USDS-M Futures.
6. The screen is very busy, but keeping to the top left of the screen, hover over the BTCUSDT Perpetual down arrow and when the search block appears type in Doge and select DOGEUSDT Perpetual.
7. Now, you need to transfer the USDT coin (which is sitting in a Spot Wallet) to a USDS-M Futures Wallet. On the top right side of the screen, just below the word Market, notice the USDT balance is 0.00. Click on the Yellow Transfer button.
8. A Transfer pop-up appears showing the From Spot Wallet and To USDS-M Futures. The coin is USDT (TetherUS) and the amount is 0. You can also see an available balance in USDT. At this point, you have a choice of percentages to transfer. For the sake of this how-to guide, I am using 100%. Click Confirm when done.
9. Once Confirmed you will notice under the Place Order (top right) a balance for USDT and a slider bar that is the SIZE you wish to Buy/Long or Sell/Short. The slider is in percentage.
Note: The very first time you set a percentage and click on Sell/Short, a video appears explaining how it all works. The nice thing is one can watch that video over and over until it is clear, but until you have passed the quiz, you will not be able to bet.
10. Once you have passed the test, you can then begin to bet by using the slider to place a betting percentage of your total wallet and once that is done you can go ahead and click on Sell/Short.
11. Once the button is clicked your position appears at the bottom of the screen.
12. Switch the chart to Trading View. It is a better chart to look at because you can see your entry point, which is depicted as a dashed red line on the chart. Looking at the chart, you only want to see red candles. Red = making money. Green = losing money.
13. Keep an eye on your position and for those nasty green candles. Since the Dogecoin is very volatile expect to see nasty green candles evaporate your red profits quickly.
14. It is always good to have a STOP LOSS, a point where you have to admit you are useless at betting against the DOGE coin. This SL will end the bet and save your money for another time.
Note: To set a TP/SL (Take Profit/Stop Loss) check the box below the slider and click on Take Profit. Fill in the TP price. Then click on the Stop Loss and set the price.
Remember: Your Take Profit price will be lower than your entry price. Your Stop Loss price will be higher than your entry price.
15. You can also close your position manually by clicking on the “Close All Positions” link in yellow/orange.
16. A pop-up appears asking if you are sure you want to close all positions at the market price. Click Confirm and take your profit.
And that is basically it. Of course, there is a lot happening on the screen and you need to have your head firmly screwed onto your shoulders. The volatility can really screw with your head, so it is important to follow the basics.
Help is always available
One very cool feature of the Binance betting screen is that there is a lot of help everywhere, simply hover your mouse over any heading (dotted line) and a help paragraph explains the terms and options.
There is also the Information pull down, which has a Guide, which opens up into a FAQ on Crypto Derivatives.
If you found this how-to post useful, drop a comment below or like the post. I have other Crypto pages on this website, so check them out. This was the first time I’ve used Crypto Derivatives and on my first bet finished up 77.39%.
Post Edit: 12/05/2021 – I put my post to the test and made some good profits. Here are just a few of them.