Understand the risk of liquidation by selling margins

The cryptocurrency trading world has become increasingly popular as many investors want to take advantage of a large return on investment. However, this growth also pose a new risk that should be carefully considered before commercial margins – a trade in leverage to strengthen profits and losses.

One of the most significant risks associated with margin of cryptocurrency is liquidation. Liquidation occurs when the position of the trader is contrary to their margin account, resulting in loss of funds or forced sale of property. In this article, we will investigate what the liquidation means for margin merchants, risks and how to protect themselves.

What is the liquidation?

The liquidation occurs when the merchant exceeded their margin in the exchange or cryptocurrency market. This can happen in several ways:

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Risk of liquidation

Liquidation can cause significant losses to traders including:

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Protect yourself from liquidation

While liquidation is a real risk, you can take action to soften its effect:

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Best trading margin of cryptocurrency

Understanding the Risks of

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Conclusion

Cryptocurrency trading can be high -risk activities, but by understanding the risk and taking action to reduce them, you can reduce the likelihood of liquidation. By doing the best practice and knowing about a possible trap, you can successfully browse the margin trading world by protecting your financial future. Remember, it is always better to make a mistake when it comes to your investment.

Additional sources

* Exchange Guidelines : Get to know the exchange policy and margin trade rules.

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