In the Crypto market where bulls and bears alternate, whenever a bear market comes, the Crypto market will fall into a pattern of stock games. At this time, the risk control of Crypto derivatives exchanges often determines the life and death of an exchange.
Since the birth of Bitcoin in 2009, the development of Crypto has been about 11 years. Because derivatives have functions such as hedging, risk aversion, and price discovery, they are enthusiastically sought after by investors. The current Crypto derivatives exchanges has begun to learn from traditional financial derivatives, and extended through products such as options and tradable indices.
From the perspective of market development, the crypto derivatives market has indeed ushered in its advantages and opportunities. The market is constantly highlighting the growing demand for options as a product, and it is also an inevitable choice for the industry to develop to the current stage. The richer the derivatives, the higher the professional requirements for the entire industry, that is to say, the higher the background requirements for practitioners, which is a good thing for the entire market.
In this article, from the perspective of market risk, we will see how TigerEX can break through the siege and do a good job in the fundamental of Crypto derivatives – risk control.
Derivatives are just a tool, which can provide investors with tools for risk management and risk transfer, enrich investment strategies, and at the same time, can provide the market with a price discovery mechanism, which can increase asset liquidity and facilitate the entry of more institutional investors. For an individual, rational use of derivatives can make his expected return match his risk tolerance. For the market, it is not derivatives that increase the risk, but the use of derivatives for excessive speculation, so investor education is a very important link. The core of derivatives is risk control. The isolated position mode is also a very important design for us. In the isolated position mode, the number of contracts, positions in each direction, and the required maintenance margin rate for the position are calculated separately. For traders, It can avoid large-scale principal damage under extreme market conditions and is more user-friendly.
The core of TigerEX risk control is to protect the security of user assets. TigerEX has established a strict financial audit and real-time monitoring and warning system, and protects the property security of every user through the separation of hot and cold wallets and hardware wallets. In terms of asset security risk control, each user has an independent asset vault in TigerEX to ensure the independence and security of assets. At the same time, professional customer service and risk control experts are appointed to analyze user asset risks and strengthen user education on risk control. Small and medium-sized blockchain enterprises that do not have sufficient technical capabilities should not quickly iterate their business, but should consider introducing third-party custody services to improve the level of digital asset storage security, and can also purchase insurance from relevant institutions. The construction of multiple wallet systems and the introduction of custody services are external factors, and asset security also tests the subjective moral hazard of the platform.
The volatility of the Crypto market is far greater than that of the traditional capital market. Crypto exchanges urgently need to strengthen the awareness of risk control and management of derivatives, and the exploration of the derivatives market is still in progress. The significance of encrypted derivatives is to make encrypted financial services more transparent, accurate and professional, allowing investors to use financial products to provide users with tools to manage their own assets. If you want to gain a foothold in the emerging trading market of cryptocurrency and promote its healthy development, the concept of always paying attention to platform risk control should not be forgotten by major intermediaries.
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