Cryptocurrency exchange Bitfinex announced today that it is publishing real-time liquidation updates on its trading site, in preparation for the rollout of its new derivative product next week.
Bitfinex CTO Paolo Ardoino revealed to The Block last week that the exchange is launching a derivative product with up to 100x leverage. Since high leverage entails high risk, Ardoino says making liquidation information public could help investors looking to take leveraged positions stay informed of market movements.
“Since we hopefully are going to roll out our new derivative market following week, we thought it was important to give full transparency there to avoid user complaints. And of course why not apply the same rules to margin trading,” said Ardoino.
In the Wild West of the cryptocurrency trading market, 100x leverage is not uncommon, with BitMEX one of the most prominent firms to offer it to date. As such, liquidation has caused the popular perpetual swap shop some headaches in the past. In May, when bitcoin price on Bitstamp crashed by 18% from $7,600 to $6,250, $250 million of long positions were liquidated on BitMEX, triggering concerns among investors.