Simply explained, margin trading is taking out a loan in order to maximize the profits you can gain from market movements. This is done when you anticipate that the market will move in a certain direction, and are willing to take on a risk in order to maximize potential profits.
Margin trades are opened by putting up a base collateral amount and taking out a loan of multiples of that base amount, known as leverage. For example, a 2x leverage would mean taking out a loan for twice the amount of the base collateral, 15x would be 15 times higher, and so on.
The higher the leverage, the more risk is involved, and the higher the interest on the loan will be. In order to margin trade, you open and fund a margin trading account separate to your regular trading account. This prevents your regular trading activity from being disrupted if your margin trading account falls below minimums.
Exchanges set margin account minimums in order to mitigate potential losses. If the value of your margin trading account goes below the minimum set by the exchange, you will receive a notification known as a margin call which will prompt you to deposit more funds in the account in order for it to remain solvent. If this is not done, then the exchange will liquidate the account to prevent further loss.