How does the margin on short positions in the digital currency market work?

1 answers

• Dec 16, 2021 · 3 years ago
  Shorting digital currencies can be a risky but potentially profitable strategy. Traders can borrow digital assets from platforms like BYDFi and sell them at the current market price. If the price drops, they can buy back the assets at a lower price and return them to the platform, making a profit from the price difference. The margin requirement is the amount of collateral that traders need to provide in order to borrow the assets. It is usually calculated based on the leverage ratio and the value of the borrowed assets. Traders should carefully manage their margin and consider the potential risks and rewards before engaging in short positions.
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