> For the complete documentation index, see [llms.txt](https://docs.bounce.tech/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.bounce.tech/basics/leveraged-tokens.md). # Leveraged Tokens ## What are leveraged tokens? Leveraged tokens are ERC-20 tokens that offer leveraged exposure to an underlying asset while maintaining the leverage factor within a targeted range. Bounce leveraged tokens are built using Hyperliquid precompiles ## Key characteristics ### **Constant leverage** What distinguishes leveraged tokens from conventional perpetual futures is the reactive rebalancing of the margin-to-notional ratio, otherwise known as the leverage factor. As opposed to a fixed amount of borrowed funds from the outset, the dynamic management of the leverage factor maintains constant leveraged exposure throughout their lifecycle. As a result, leveraged tokens do not require any margin management by the holder. ### **Composability** Leveraged tokens implement the ERC-20 token standard. This means these tokens will appear in your wallet, can be transferred at your discretion, and seamlessly integrate into the broader DeFi ecosystem. ### **Deep liquidity** All leveraged tokens are tokenized representations of perpetual futures contracts accessed through Hyperliquid pre-compiles. By drawing from the deep liquidity and benefiting from the cost-effective fees provided by Hyperliquid perpetual markets, these tokens offer a powerful and efficient way to access leveraged positions. --- # Agent Instructions This documentation is published with GitBook. GitBook is the documentation platform designed so that both humans and AI agents can read, navigate, and reason over technical content effectively. Learn more at gitbook.com. ## Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter, and the optional `goal` query parameter: ``` GET https://docs.bounce.tech/basics/leveraged-tokens.md?ask=&goal= ``` `ask` is the immediate question: it should be specific, self-contained, and written in natural language. `goal` is optional and describes the broader end goal you are ultimately trying to accomplish on behalf of the user. GitBook uses it to tailor the answer towards what is most useful for that goal. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.