by Penny Angeles-Tan | Oct 23, 2024 | Business
Learn about liquidation in crypto futures trading, from what the contract is to how it works. This article discusses the factors that cause liquidation, the process, and the importance of risk management for traders to avoid financial losses. Discover strategies for success in the world of crypto futures!
A futures contract is an agreement to buy or sell an underlying asset at a specified price at a specified date in the future. This is a type of derivative contract. These contracts are important in financial markets as they provide traders with opportunities to hedge or speculate.
In this article, we will discuss this type of trading about crypto liquidations and try to understand why crypto liquidations are a valuable tool.
Understanding Crypto Liquidation in Futures Trading
Crypto liquidation in futures trading is about closing positions to balance the initial trade. If a trader has a long position, meaning they want to buy the asset, they must sell the contract to liquidate it. Conversely, if they have a short position, meaning they want to sell the asset, they must buy back the contract to complete the liquidation.
Crypto liquidations are common in futures trading, but traders should think carefully about the effects. This includes looking at how leverage can affect trading results.
Not knowing how crypto liquidation works can lead to major financial losses, especially for new traders who may not fully understand futures trading. In other words, traders who do not know when and how to manage their positions risk liquidation.
Basics of Crypto Liquidation in the Market
Crypto liquidation in futures trading depends on margin requirements. When you trade futures, you must deposit a percentage of the contract value as a margin. It serves as collateral to cover possible losses.
When the price of the underlying asset changes, margin requirements also change. If a trade goes against you and your margin account falls below a certain level, known as maintenance margin, you will receive a margin call.
How Crypto Liquidation Works in Futures Trading?
Liquidation in futures trading occurs for two main reasons:
1. The first reason is voluntary crypto liquidation. Here, a trader decides to close a position before the expiration date of the futures contract. They may do this to take profits, limit losses, or change their trading strategy based on market analysis or risk appetite.
2. The second reason is forced liquidation. This occurs when a trader’s margin account falls below the required maintenance margin level. This usually happens because the price of the underlying asset has fallen. In this case, the brokerage firm can sell the trader’s position, no matter what their investment plans or outlook.
Crypto Liquidation Process for Traders
The liquidation process for people trading in the futures market has several steps. When a trader wants to close their position or if they get a margin call, the first step is to place an order against their current position. For example, if a trader is long on a futures contract, they would need to enter a sell order for the same type and number of contracts.
Profits go to the trader’s trading account, while losses reduce the margin account. Traders need to keep an eye on their margin levels, especially during difficult market conditions. This helps them avoid forced liquidation and major financial losses.
Factors Leading to Liquidation in Futures
Several things can cause the liquidation of a futures contract. This affects both long and short positions. One major factor is that large changes in the price of the underlying asset can lead to large losses and margin calls.
High liquidity in the futures market can exacerbate this. Even small price changes can cause large fluctuations.
Changes in interest rates can affect the costs associated with futures positions. This can affect how profitable the position is and may lead to liquidation. It is important to know that futures trading uses leverage. This means that profits and losses can be magnified.
Traders should think about market risk, interest rate changes, and their risk tolerance. This will help reduce possible liquidation risks.
Conclusion
MKnowing about crypto liquidation in futures trading is the key to success. When you understand the basics, you can move through the markets better. You can use risk management techniques is important.
Understanding trading strategies will also help you to avoid unwanted liquidations. By focusing on timing, predicting trends, and taking advantage of market changes, traders can make better choices.
Bitrue can help you do research before trading crypto futures. You can study before buying futures Bitcoin, Ethereum, Solana, XRP, and other crypto tokens. Also, find out how to convert prices from Ethereum to USD and other tokens easily on the Bitrue website.
This Press Release has also been published on VRITIMES
by Penny Angeles-Tan | Oct 19, 2024 | Business
Ripple partners with leading exchanges to launch RLUSD! Learn how this stablecoin will change the global payments landscape and attract institutional investors.
Ripple USD (RLUSD), the new stablecoin from Ripple, has been anticipated since its first announcement. This stablecoin is designed to have an equivalent value to the US dollar and aims to facilitate cross-border transactions and provide stability in the digital asset ecosystem.
Understand fully about RLUSD, how it differs from other stablecoins, and when the RLUSD launch will be officially carried out by reading this article to the end.
What is RLUSD?
RLUSD is a type of cryptocurrency whose value is pegged to the US dollar. In contrast to cryptocurrencies such as Bitcoin whose value is very volatile, RLUSD is designed to have a stable value. This makes it a more reliable means of payment, especially for cross-border transactions.
How does RLUSD work? So, each RLUSD token is backed by US dollar reserves held in a separate account. This reserve will be regularly audited by a third party to ensure that the number of RLUSD tokens in circulation always corresponds to the value of US dollars held.
Some of the reasons why RLUSD was launched are:
1. Meet market needs: There is a high demand for stable and reliable stablecoins for various purposes, such as payments, asset tokenization, and DeFi.
2. Increasing adoption of blockchain technology: RLUSD is expected to accelerate the adoption of blockchain technology in the financial industry.
3. Connecting traditional and digital worlds: RLUSD can be a bridge between the traditional financial system and the world of digital assets.
RLUSD advantages
Capped by the US dollar, the value of RLUSD tends to be more stable than other cryptocurrencies. RLUSD is also backed by US dollar reserves guaranteed by the government.
Not only that, RLUSD can be used in various countries and regions through Ripple’s partner network. This stablecoin is designed to meet strict regulatory standards, providing more confidence to users. RLUSD can operate on multiple blockchains, including XRP Ledger and Ethereum.
Who Supports RLUSD?
Several major crypto exchanges have expressed support for RLUSD, including:
1. Uphold: Popular multi-asset trading platform.
2. Bitstamp: One of the oldest and most trusted cryptocurrency exchanges.
3. Bitso: Latin America’s leading cryptocurrency exchange.
4. MoonPay: Crypto payment infrastructure provider.
5. Independent Reserve: Australia-based cryptocurrency trading platform.
6. CoinMENA: A cryptocurrency exchange focused on the Middle East and North Africa.
7. Bullish: A cryptocurrency exchange backed by Peter Thiel.
The Future and Comparison of RLUSD with Other Stablecoins
With support from strategic partners and a focus on regulatory compliance, RLUSD has great potential to become one of the world’s leading stablecoins. RLUSD can accelerate the adoption of blockchain technology in a variety of sectors, including finance, commerce, and real estate.
To provide a clearer picture of RLUSD’s position in the market, we can make a comparison with other popular stablecoins such as USDT and USDC. Some aspects that can be compared include:
1. Guarantee Mechanism
RLUSD: Reportedly backed by US dollar reserves, short-term government bonds, and other cash assets. Ripple is committed to conducting monthly audits of these reserves.
USDT: Originally claimed to be fully backed by US dollars, however, there has been some controversy regarding the transparency of its reserves.
USDC: Reported to be fully backed by US dollars and equivalent assets, with monthly audits performed by major accounting firms.
2. Transparency
RLUSD: Ripple has expressed its commitment to transparency by conducting monthly audits of RLUSD reserves.
USDT: USDT’s transparency has been a subject of debate, especially after several reports cast doubt on their claims of full reserves.
USDC: USDC is considered to have a higher level of transparency than USDT, with monthly audits conducted by large accounting firms.
3. Market Adoption
RLUSD: Still relatively new and has not yet reached the same level of adoption as USDT or USDC. However, with the support of major exchanges and Ripple’s reputation, the adoption potential of RLUSD is huge.
USDT: USDT is the most widely used stablecoin in the world, with a huge market capitalization.
USDC: USDC is USDT’s closest competitor and has gained widespread adoption across DeFi platforms and exchanges.
4. Regulation
RLUSD: Ripple has stated that RLUSD is designed to meet strict regulatory standards, including oversight from the New York Department of Financial Services (NYDFS).
USDT: USDT has faced several regulatory challenges, especially regarding its reserve claims.
USDC: USDC is generally considered more regulatory compliant than USDT and has received approval from various regulators.
5. RLUSD Competitive Advantages
Ripple Support: Ripple has an extensive network and experience in the blockchain industry.
Focus on institutions: RLUSD is designed to appeal to institutions with an emphasis on security, transparency, and regulatory compliance.
Integration with Ripple ecosystem: RLUSD can be integrated with Ripple’s cross-border payment solutions and other products.
Potential Uses of RLUSD
Apart from cross-border payments, RLUSD has great potential for use in various other applications, such as:
1. DeFi (Decentralized Finance): RLUSD can be used as an underlying asset in various DeFi protocols, such as lending, borrowing, and yield farming.
2. Asset tokenization: RLUSD can be used to tokenize real-world assets, such as real estate, stocks, and commodities.
3. In-game payment: RLUSD can be used as currency in blockchain-based games.
Conclusion
The launch of RLUSD is an important step for Ripple and the cryptocurrency industry as a whole. With support from strategic partners and a focus on regulatory compliance, RLUSD has the potential to become one of the world’s leading stablecoins.
However, the success of RLUSD will also depend on several factors, such as market developments, regulatory changes, and Ripple’s ability to continue to innovate.
The creation of RLUSD will also have a positive impact on XRP price, especially when it is launched. If you are one of the XRP token holders, you can feel happy about this innovation from Ripple. However, don’t be careless buy XRP coins.
You still have to do research before deciding to invest completely in a token. Find out what the current condition is, and whether the value of XRP to USD is strengthening or not. Carry out a tactical strategy so you can invest according to your current financial condition.
This Press Release has also been published on VRITIMES
by Penny Angeles-Tan | Oct 18, 2024 | Business
Explore the potential rewards and risks of investing in the Bitcoin futures market. A complete guide to understanding market dynamics and making better investment decisions.
Bitcoin, as the largest cryptocurrency, continues to attract the interest of investors from various circles. One of the interesting aspects of Bitcoin is the futures market which allows traders to speculate on the price of Bitcoin without needing to buy or sell physical coins.
This article will discuss the increase in Bitcoin open interest along with an analysis of the Bitcoin futures market. Read to the end to understand the entire explanation.
Bitcoin Futures Market Analysis
Recent analysis suggests that the Bitcoin futures market may be heading into its second bullish phase. Data from CryptoQuant shows increased leverage in the BTC USDT futures market, which could be an indication of potential significant price movements.
Ki Young Ju, CEO of CryptoQuant, analyzed two important metrics: the ratio of BTC-USDT open interest to reserves and the ratio of BTC-USDT open interest to USDT market capitalization. These two metrics indicate a significant increase in leverage in the Bitcoin futures market.
Increased Open Interest
Bitcoin (BTC) open interest reached a staggering $19.8 billion at 574,680 BTC on October 15. Data from CryptoQuant reflects a significant increase in demand for the largest cryptocurrencies, indicating how much new money has entered the digital asset market in recent months.
The funding rate has surged to the highest level since August, indicating that most of those open positions are long positions expecting further appreciation.
While an increase in open interest is usually a positive indication for Bitcoin price action, some market observers have expressed concerns that increased volatility could be threatened.
The highly leveraged nature of the futures market will eventually pave the way for large-scale liquidations if and when sudden price swings occur.
According to data from Glassnode, a large number of Bitcoin futures contracts are cash-margined and not crypto-margined, meaning they are collateralized by US dollars or dollar-pegged stablecoins and not the cryptocurrency itself.
Bitcoin Price Increase Potential
At the moment, Bitcoin price in the Bitrue futures market it was at $67,764 with an increase of 0.78%. Previously, within 24 hours, Bitcoin reached its highest price in the futures market at $68,353.
It can be seen from the BTC price chart excerpt above that the RSI value is 63, which means a trend to buy Bitcoins is much more dominant than the selling trend. However, this dominance is still within reasonable limits, not overbought.
The MACD line appears to have a downward trend, but the position of the line which is still above the threshold indicates that the BTC position is currently strong in its bullish possibility.
An increase in open interest can be a positive indication of Bitcoin’s potential price increase. However, keep in mind that the crypto market is highly volatile, and factors such as changes in regulatory policies and technological developments can affect the price of Bitcoin.
Risks to be Aware of
The crypto market is known for its high volatility, so the price of Bitcoin can experience sharp fluctuations. Changes in regulatory policies can also affect Bitcoin prices.
Using leverage can increase potential profits, but also increases the risk of loss. Apart from that, Bitcoin also faces competition from other cryptocurrencies.
Conclusion
The increase in Bitcoin open interest shows the high interest of investors in the futures market. However, keep in mind that high open interest can also increase the risk of volatility. If the market moves against a trader’s position, massive liquidations can occur.
For those of you who are interested in investing in Bitcoin in the futures market, do not immediately invest without studying current market conditions. Do your own research (DYOR) by knowing price statistics, price conversions from BTC to USD, and how the project is progressing. Knowing the fundamentals of a token is also very good for knowing where you stand as an investor.
This Press Release has also been published on VRITIMES
by Penny Angeles-Tan | Oct 16, 2024 | Business
Will Donald Trump Vs. Kamala Harris’ candidacy in the 2024 US election have a positive impact on the crypto ecosystem? Read the full explanation in this article.
The United States presidential election has become a highlight among the crypto community. The reason is, that the United States is a region that often focuses on crypto regulations.
Therefore, the crypto community hopes that Donald Trump vs. Kamala Harris can get a detailed explanation of their plans for crypto regulation when they are elected.
Kamala Harris is considered to be more open to crypto if elected than her boss, Joe Biden. However, Kamala Harris remains behind Donald Trump, who from the start has paid full attention to the crypto ecosystem, even outspokenly wanting America to become a center for Bitcoin mining.
Donald Trump and His Interactions in the Crypto Ecosystem
Donald Trump is already “more experienced” in the crypto ecosystem than his opponent, Kamala Harris. Since his confirmation that he will be a presidential candidate in the 2024 US Election, he has been welcomed by the crypto community. Memes about him appeared to attract attention.
In his campaigns in various regions, Trump also loudly called for supporting cryptocurrencies and relaxing regulations. Last July, Donald Trump even promised to fire Gary Gensler, who is currently the head of the SEC. It is common knowledge that the SEC is often an obstacle to the development of the crypto ecosystem in America.
Increasingly gaining support from the crypto community, Trump is also increasingly strengthening his position to support the progress of cryptocurrency by becoming a figure who does it The first transaction is on a bar called PubKey. This transaction was carried out in mid-September and received a positive reaction from crypto circles.
Recently, Donald Trump also stole the attention of the crypto ecosystem by launching a platform called World Liberty Financial or WLFI. WLFI is a crypto platform that offers various financial activities, including lending, investment, and digital transactions.
Before its launch, WLFI even received more than 100,000 registrations and this fact is of course good news for Donald Trump in his candidacy in the 2024 US Election.
Kamala Harris and the Crypto Regulatory Framework
Not wanting to be left behind by Donald Trump, Kamala Harris also tried to attract the sympathy of the crypto community by stating that she also supports crypto. In her campaign in Erie, Pa., Kamala Harris outlined a big agenda in which she discussed Harris’ substantive policies on cryptocurrencies.
There is a crypto regulatory framework there. However, Harris did not explain in detail how he would create the regulatory framework.
There is no mention of Bitcoin, blockchain, or other digital assets in the regulations proposed for the crypto ecosystem. Due to this, the crypto community feels disappointed with Kamala Harris.
Conclusion: Trump Vs. Harris, Will Crypto Get the Benefit in the End?
No matter how sweet Donald Trump’s promises are and how Kamal Harris provides evidence of his support for crypto, the crypto community must remain careful about the existing political system. Every crypto observer must provide neutral criticism and suggestions without leaning towards either candidate to the extreme.
Policy in America will always be the basis for how crypto tokens are traded so that the results of the US election will determine future crypto developments.
You can do comprehensive analysis and research when you want to buy a coin. Know Bitcoin price, Ethereum, XRP, Solana, USDT, and other tokens. Use features on a trusted global exchange website, such as Bitrue, to find out crypto market conditions in real-time.
This Press Release has also been published on VRITIMES
by Penny Angeles-Tan | Oct 16, 2024 | Business
Most crypto tokens are experiencing price increases today. How are the 5 major crypto tokens doing? Are they also experiencing increases?
October is known as an exciting month for the crypto community due to its #Uptober tradition. This year, it is predicted that #Uptober will come in mid-October. And today, it is proven that the crypto ecosystem is in the green zone with the majority of tokens experiencing price increases.
In this article, we will discuss the condition of the 5 major tokens in the crypto ecosystem, namely Bitcoin, XRP, Solana, Ethereum, and USDT. These five tokens are often a guide to conditions in market crypto. Because, when the five experience an increase or decrease, it will definitely have an impact on other tokens.
Price Increase for 5 Major Tokens
The crypto community is experiencing excitement today because major tokens in the crypto market are experiencing price increases. Starting from Bitcoin, XRP, Ethereum, Solana, to Tether USDT, their prices have increased and reached their respective target price levels.
Bitcoin today is at the $65,000 level Moreover, it was even traded at more than $66,000 as its highest price in 24 hours. This increase is a breath of fresh air because Bitcoin experienced a price decline for quite a long time after its halving moment.
Ethereum, which is always seen as pessimistic because its price continues to fall, today also experienced a price increase of 2.11% and is now trading at $2,596.
Solana may only see a 0.26% gain. However, the SOL token price currently exceeded its resistance price of $148,500 and is now trading at $153.39.
XRP also increased by a similar percentage to Solana, namely 0.26% and is now at $0.541. USDT experienced the smallest price increase, namely only 0.03% and was trading at $1.00.
Rising Crypto Market Prices Sign of the Coming of #Uptober?
Many analysts predict #Uptober 2024 will come in mid-October after two weeks of stagnant crypto tokens at boring prices. With the increase in 5 major tokens today, it seems that this prediction is true.
Historically, #Uptober has never come directly at the beginning of October. In general, #Uptober only arrives in mid-October or even arrives in November. However, optimistically, the crypto market increase always comes in Q4 every year.
Several major crypto tokens have passed their resistance prices. If these prices persist long enough, a bullish trend for each token is bound to occur. If a major token experiences a bullish moment, it is not uncommon for other tokens to also be affected and experience increases as well.
Conclusion
That is an explanation of today’s crypto market conditions. You can continue to follow developments in information about the crypto ecosystem, starting from finding out Ethereum price, Bitcoin, XRP, Solana, USDT and various other meme-coins and tokens, Bitrue provides real time data for you.
You can even check price conversions from BTC, ETH, XRP, SOL, etc. from USDT to USD easily on the Bitrue website. The Bitrue blog also provides the latest information through articles written in real time, so you can follow crypto market conditions every day.
This Press Release has also been published on VRITIMES
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