Yes, through futures, perpetual swaps, CFDs with a regulated broker, or margin borrowing on an exchange. Each has different funding costs and liquidation rules.

Why is shorting considered riskier?

Because losses are theoretically unlimited — a stock or coin can keep rising indefinitely — while a long position can only lose what you put in.

Do I pay to hold a short overnight?

Usually yes. Borrow fees, funding rates or swap charges accrue daily and can meaningfully erode a short held for weeks.

Long vs Short: What They Mean and How Shorting Works

Long: the familiar direction

A long position is what most people mean by investing. You buy at one price, sell at a higher one, and the gap is your profit. Your maximum loss is the amount you paid — the asset can go to zero but no further.

Short: the mechanics

Shorting reverses the order of operations: sell first, buy back later. In a traditional short you borrow the asset from your broker, sell it at the market price, then repurchase it to return it. With CFDs, futures or perpetuals you never touch the underlying asset — the contract simply pays the difference.

Example

You short 1 BTC at $95,000 and close at $88,000. You keep the $7,000 difference, less borrowing costs, funding and spread.

The asymmetry that matters

A long position has capped downside and uncapped upside. A short position is the opposite: the most you can make is 100% (the asset going to zero) while the loss is theoretically unlimited, because there is no ceiling on price.

This is not a reason to avoid shorting — it is a reason to always short with a stop.

The ongoing costs

Borrow fees on traditional shorts, which spike when an asset is hard to borrow.
Funding rates on crypto perpetuals, paid every few hours to the other side.
Overnight swap on CFD positions, which can be positive or negative.
Short squeezes — crowded shorts forced to buy back at once, accelerating the move against you.

Long vs short, explained