Can you explain the concept of margin call in the realm of digital assets?

1 answers

• Ceballos-San MDFeb 24, 2025 · a year ago
  Margin call in the realm of digital assets is when your account balance falls below the required margin level set by the exchange. The exchange will issue a margin call, giving you a certain period of time to deposit additional funds to meet the margin requirements. If you fail to do so, the exchange may liquidate your positions to cover the losses. It's important to understand and manage your margin levels to avoid margin calls and potential liquidation. Think of a margin call as a warning sign that your account balance is getting low and you need to add more funds to cover potential losses. If you ignore the margin call, the exchange may take action to protect itself by selling off your assets. Make sure to regularly monitor your margin levels and be prepared to deposit more funds if necessary to avoid margin calls and the risk of losing your assets.
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