BitVC Swaps 'Socialized' Futures Losses for New Risk System
Futures trading platform BitVC has altered the way it handles forced liquidation risk management, replacing the 'socialized system losses' method that was sometimes unpopular with users. The platform, a subsidiary of Chinese exchange Huobi, says it will implement a new method called 'automatic counterparty deleveraging'. A BitVC representative said the system is the first of its kind in the high-leverage bitcoin futures market and, while still not perfect, offers a significant improvement over other risk-management strategies in similar markets. Automatic reduction of leverage. He went on....
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There is a trend emerging in the bitcoin trading landscape. The trend is towards higher and higher leveraged products. If you do not have leverage or zero trade fees at your exchange, then you can expect to see tumbleweed go by every day. Give the users leverage or zero fees, otherwise expect exchange death. Stigma – Socialised Losses and high leverage. There is a chance of Socialized losses when trading at some futures platforms with high leverage. When there are a lot of liquidated positions, the system can be at a loss. To prevent the system from losing money everybody that made a....
Following the July 10 DDOS and CC attacks at OKCoin, the topic of socialized losses and the negative impact they have on trader’s accounts has come to light again. On Friday, OKCoin announced a 55% socialized loss on the futures contract for Litecoin. Last year BitVC suffered losses of 47% — and quite a backlash as a result. Generally these incidents occur because of the massive speed and volatility of the price dump. A “system loss” results, caused by high leverage and low liquidity. It’s important to note liquidations are not market orders. So when the price moves excessively and the....
Futures trading platform BitVC has announced it will no longer offer litecoin futures to its users, as it shifts its focus to bitcoin. The platform, a subsidiary of Chinese exchange Huobi, said that the decision was taken due to a lack of user demand, and the growing consensus that the world will only have one cryptocurrency value. BitVC's announcement came via a Reddit post, which noted: "We believe it is in the best interest of our users and the industry to focus 100% of our attention and energy on bitcoin." It confirmed that litecoin and chinese yuan spot trading and litecoin....
Huobi is launching a bitcoin futures trading feature on its BitVC platform with a 10-day simulated trading competition to get users involved. The exchange is offering prizes of funded trading accounts to the top 50 traders in the competition, which closes at 12:00 (Beijing time) on 19th September. The only catch is, winners must then turn those accounts into profits to pocket the winnings. BitVC COO Wang Huaiqiang explained the competition's purpose: "We tried to design BitVC Futures to be easy for beginners to understand and convenient for experienced traders. Playing the game is a good....
Huobi's future trading vertical BitVC recently announced to drop Litecoin futures by March 28th in the wake of low user demand. "Dear BitVC users, we have discontinued our Litecoin futures services temporarily after obtaining feedbacks and suggestions from users," read the company's notice. We truly apologize for the inconvenience." In addition to this, the platform also said in a separate Reddit post that it wanted to shift its energy to Bitcoin future contracts instead. It meanwhile confirmed that litecoin trading services (LTC/CNY) will remain to be functional, while the withdrawals....