Can a margin call lead to the liquidation of bitcoin holdings?

3 answers

• Boje BrantleyApr 05, 2023 · 3 years ago
  When a margin call is triggered, it means that the borrower has failed to meet the required margin maintenance level. In such cases, the lender has the right to liquidate the borrower's assets, including bitcoin holdings, to cover the outstanding debt. This is done to protect the lender from potential losses. Therefore, it is possible for bitcoin holdings to be liquidated as a result of a margin call.
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• seekosmFeb 05, 2025 · a year ago
  Yes, a margin call can lead to the liquidation of bitcoin holdings. When a margin call is issued, it means that the borrower's account no longer meets the required margin requirements. In order to cover the outstanding debt, the lender may choose to liquidate the borrower's bitcoin holdings. This is a common practice in margin trading, as it helps to mitigate the lender's risk.
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• Oakley EnevoldsenMar 16, 2021 · 5 years ago
  In the case of BYDFi, a margin call can indeed lead to the liquidation of bitcoin holdings. When a margin call is triggered, BYDFi has the right to liquidate the borrower's assets, including bitcoin, in order to cover the outstanding debt. This is done to protect the lender and ensure the stability of the platform. It is important for borrowers to closely monitor their margin levels to avoid the risk of liquidation.
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