What happens to your money in the event of liquidation? 😵
Here's what happens:
1️⃣ Liquidation fees: The platform (like Binance) charges a fee on the liquidated trader's collateral.
2️⃣ Counterparties: Traders positioned against the trade recover their profits through the liquidation of the position.
3️⃣ Insurance fund: If after the repayment of debts and fees there are funds remaining, they are transferred to Binance's insurance fund, which is used to protect the system in the event of exceptional losses.
👉 In short, Binance collects the fees, and other traders benefit from the profits related to the liquidation.
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