Why do some people say that you should not play contracts when trading in cryptocurrencies?
1. Playing perpetual contracts is actually like playing a game of rock-paper-scissors with the exchange. The exchange knows your cards (your positions), and they can use various means (such as price manipulation) to make you lose more miserably.
2. The leverage effect of the contract is like giving you a double-edged sword, doubling your happiness when you make money and doubling your pain when you lose money. It makes greed and fear infinitely magnified. If you win, you want to win more, and if you lose, you always want to turn the tables, and finally often fall into the "gambler's dilemma".
3. As you said, the exchange will use the distribution of chips in the market to deliberately create price fluctuations (pins), catching many people off guard and causing them to blow up. Behind this, it is actually the exchange that is making money by taking advantage of information.
4. In contract trading, it is easy to lose your balance. It is easy to get carried away when you make a profit, and to be anxious when you lose money, and frequent operations will lead to more losses. In the end, many people only want to keep their principal, and nothing else matters.
Contract trading is like a high-risk game, which not only tests your skills and judgment, but also your mentality and self-control.
If you are not a professional trader, it is easy to be swallowed by this game. Therefore, many people choose not to play contracts in order to avoid these unnecessary risks.