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The Role of Auto-Liquidation Algorithms in Crypto Margin Trading

Crypto & Web3.0

The Role of Auto-Liquidation Algorithms in Crypto Margin Trading


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Traders often use leverage to increase the potential profit of trade, hence those transactions are done on margin. If the trader’s account value falls below the required minimum maintenance level, a broker has the legal right to liquidate those positions in order to cover the margin call. Brokers use real-time liquidation procedures, the so-called auto-liquidation algorithms, and automated trading strategies.



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Leonardo DeFi Caprio

Journalist. I am interested in DeFi, Web 3.0, Metaverses, Crypto adoption, blockchain technology

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