📢 Attention crypto-investors! Not all Bitcoin (BTC) and cryptocurrency futures liquidations are the result of reckless use of leverage. Some trading strategies used by professionals also end up being liquidated during sharp price movements. 💡

Futures markets, especially perpetual contracts (reverse swaps), are quite easy to use. However, unlike spot trading, a futures contract cannot be withdrawn from the exchange. These leveraged futures contracts are synthetic, but they also offer the possibility of going short, that is, betting on the price going down.

Professional traders typically use three different strategies to maximize profits without relying solely on directional trading:

1. Forced liquidations in low-liquidity pairs: "Whales" use futures contracts to exploit volatile markets by opening highly leveraged positions, anticipating forced liquidations due to insufficient margins.

2. "Cash and carry" trading: This strategy involves buying an asset in the spot market and simultaneously selling a futures contract for that same asset.

3. Financing Rate Arbitrage: Perpetual contracts (reverse swaps) charge a financing rate to balance buyers and sellers.

In essence, the use of derivatives requires knowledge, experience and a substantial reserve of capital to withstand market volatility. And you, how do you use leverage in your investment strategies? Share your experiences in the comments! 🚀