What is Liquidation?

This week's term in Kevin explains crypto is Liquidation. Most people in crypto already know what liquidation is, if they didn't in the week prior, they definitely know that it is this week. Liquidation essentially is getting your positions closed because you don't have enough money to support those orders. In industry terms we'd say you don't have enough margin.

When you don't have enough money in your account to support the risk on your (usually) leveraged positions you get liquidated. And your orders are forcefully closed.

Liquidation can result in negative balances.

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