Risks With Leverage Pools

Leverage pools allow traders to pool their resources to access larger trading positions. However, these pools are not without their risks. One of the primary concerns is the amplified risk of collective loss. Since leverage magnifies both gains and losses, a substantial market movement against the pool's position can lead to significant losses for all participants.

Additionally, liquidity risk is a major factor. In times of market stress or high volatility, it might become challenging to liquidate positions at favorable prices, impacting the pool's value. This situation is particularly acute for pools investing in low liquidity or low cap assets.

Given these risks, certain leverage pools may need to be closed to protect the interests of the investors. This closure can be a proactive measure to prevent potential heavy losses in the face of unfavorable market conditions or when the risks outweigh the potential benefits. Closing a pool is a significant decision, reflecting a commitment to investor safety and long-term platform sustainability. Our platform continuously monitors market conditions and the performance of each pool, making informed decisions to safeguard the interests of our community of traders.

We have functions to settle positions for users that may take place in delisting, read about pool migration to get a better insight on how this process will take place