The truth about futures contracts in the currency circle (3)
In the first two articles, I shared with you the basic concepts, development history and development of futures contracts in the currency circle.
As a long-term investor, I think the safe and appropriate way is to use futures contracts as a tool for hoarding coins, rather than as a tool for speculation, because it is used for speculation, and it also brings high returns to traders. posed high risks.
However, the temptation of interest is always irresistible. In fact, in the currency circle, more traders use contracts plus leverage for speculation, but there are a lot of pitfalls and traps in this process.
We all know that in a casino, the casino owner is the big winner in the end, and the vast majority of gamblers are losers without exception. Therefore, the most important task of the casino owner is to attract gamblers to the casino. Because once the gambler is addicted, the relationship between the casino and the gambler is doomed.
The same is true in the currency circle. As I said in a previous post,The exchange is a big casino in the currency circle, but this casino is more dangerous than ordinary casinos, because ordinary casinos are supervised by the government, there are laws to follow, and laws must be followed, but this casino is outside the law. It's up to the casino owner to call the shots. Therefore, once a gambler enters the big casino of the currency circle, the probability of losing will only be greater, and the chips for losing will only be more.
All exchanges understand this truth, so all exchanges will try their best to attract traders into this big casino, so a series of means and tricks start from attracting traders into the casino. Among all the exchanges, large exchanges still have a certain bottom line, while some small and medium-sized exchanges, especially the third- and fourth-tier exchanges that are not in the mainstream, have no bottom line and use various means to attract traders.
The exchange will pay special attention to users who have participated in contract transactions. Once such potential customers are found, the phone call will be made inadvertently, and traders will be lured to join the QQ group or WeChat group by free entry into the group to lead the way and copy transactions, and trade with the so-called "teacher".
Once the user really enters this group, the nightmare begins. In the early days of entering the group, there will indeed be "teachers" who will lead traders to use futures and leverage to speculate in coins. In order to make the scene more realistic and attractive, the teachers will choose some little-known altcoins. In fact, these altcoins may often be the varieties controlled by the exchange itself, and it is the exchange itself that has the final say on raising and smashing the market.
In order to let the traders who are new to the game taste the sweetness, the teachers often let the traders make money when they start trading. And once there is a profit-making effect, the trader will invest more and more principal, and the leverage used will become higher and higher. Eventually, the trader will lose all his capital and profits.
If during this process, some users are really lucky, earn money, and want to withdraw coins, then they will encounter various obstacles in the future.
The first is that the exchange sets up various obstacles through various reviews to slow down the process of withdrawing coins. During this process, users' funds will be locked and liquidity will be greatly reduced.
Even if these reviews are passed, the second obstacle is the requirement for the minimum withdrawal limit. Many counterfeit exchanges will set the minimum withdrawal limit very high.
Even if the user satisfies the minimum withdrawal limit and is ready to withdraw, the next game is the exchange’s game of plucking the hair - the exchange will set high handling fees for this type of withdrawal.
Therefore, when trading futures contracts, traders must be cautious and avoid these big pits.
