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- Therefore, no matter how the price of the corresponding coin/token changes, there will never be a liquidation.
- Even more, if the BTC price climbs up afterwards, the price of BTC3L will also increase, so there is still an opportunity to turn the negative profits into positive!
- Besides, under other extreme fluctuations like continuous skyrocketing or plummeting, there will also be a risk that the net value of BTC3L and BTC3S tends to zero.
- If BTC continues to rise in the first 10 days with a total increase of 200%, and then immediately falls for 10 days in a row with a total decline of 200%, then the net value of BTC3L and BTC3S may be at the risk of tending to zero.
- As a product that has been polished in the traditional financial market, this leveraged token product can satisfy the appetites of most investors.
However, the leveraged tokens seek to magnify profits by amplifying the rise and fall of the underlying asset, and the leverage is reflected in the price changes. The rebalancing mechanism aims to adjust the position of the contract of the leveraged tokens, therefore to maintain the leverage rate. If investors go 3x long BTC in the margin market, when the BTC price decreases by 33%, they will face liquidations and lose all their funds. However, with the dynamic rebalancing mechanism, that tragedy will not happen. Even more, if the BTC price climbs up afterwards, the price of BTC3L will also increase, so there is still an opportunity to turn the negative profits into positive!
BTC3S
Theoretically, the net value of the leveraged fund is the fair price of leveraged token shares in the secondary market. However, due to market fluctuations, the transaction price in the secondary market may deviate from the fair price (that is, the net value of the fund) at certain times, resulting in a price premium. Leveraged tokens products do not require margin or crypto borrowing, and there is no risk of liquidation. KuCoin Leveraged Tokens are tokens with the feature of leverage, you can find corresponding coins/tokens for all leveraged tokens. If BTC continues to rise in the first 10 days with a total increase of 200%, and then immediately falls for 10 days in a row with a total decline of 200%, then the net value of BTC3L and BTC3S may be at the risk of tending to zero. If the daily change of BTC price in 100 consecutive days is +10%, -10%, +10%, -10%…
What is the current BTC3S to USDT exchange rate?
Thanks to the mechanism, the system will automatically incorporate the profits into the original sum of investment and keeps the leverage at a fixed multiple to ensure the profit is compounded. Although leveraged tokens are featured with leverage, they are still the spot trading type. Therefore, no matter how the price of the corresponding coin/token changes, there will never be a liquidation.
BTC3S TO USDT CHART
As a product that has been polished in the traditional financial market, this leveraged token product can satisfy the appetites of most investors. However, this product is particularly tailored for investors who believe that there will be volatility in the prices of the underlying assets, or those who do not want to bear https://cryptolisting.org/ the risk of liquidation. Due to the management fees and the feature of leveraged token products, investors may suffer losses when facing market volatility. Margin trading leverages the borrowing of funds to its margin amount to enlarge the profits or losses, the leverage is based on the amount of crypto that one holds.
Respectively, then the return rate of BTC3L and BTC3S will be -99.1%, there’s risk that the net value will trend to zero. 3X Short Bitcoin Token Dec 24, 2019 had the highest price, at that time trading at its all-time high of $158.1. Besides, under other extreme fluctuations like continuous skyrocketing or plummeting, there will also be a risk that the net value of BTC3L and BTC3S tends to zero.