What are the common reasons for liquidation in the world of digital currencies?

1 answers

• May 10, 2022 · 3 years ago
  At BYDFi, we understand the importance of risk management in the world of digital currencies. One common reason for liquidation is the failure to set proper stop-loss orders. Stop-loss orders automatically trigger a sell order when the price of a cryptocurrency reaches a predetermined level, helping to limit potential losses. Without proper risk management strategies in place, investors may find themselves in a situation where they have to liquidate their positions to cut their losses. It is crucial for investors to carefully assess their risk tolerance and set appropriate stop-loss orders to protect their investments in the volatile world of digital currencies.
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