Contracts can make retail investors rich overnight, but they can also bankrupt big players in three days.

Contracts can make retail investors rich overnight, but they can also bankrupt big players in three days.

It is both the nuclear weapon of Wall Street and the harvester of the cryptocurrency world.

Let’s explain the understanding of contracts to novices. First, let's mention the hardest truth: 83% of the wealth created globally is related to contracts, but 98% of retail investors are cannon fodder.

Now the key point is that this contract was originally designed as a protective tool for farmers. In 1848, Chicago farmers collectively collapsed, with vegetable prices fluctuating so wildly that people turned gray overnight. The plight of farmers back then has now evolved into Bitcoin miners worrying about price halving, quantitative teams at exchanges frantically placing orders, and retail investors playing Russian roulette in perpetual contracts.

Let's compare: traditional agricultural contracts lock price fluctuations at around ±5%, while modern cryptocurrency contracts can leverage up to 125 times, with some small exchanges even reaching 300-400 times. Data from a certain exchange shows that 90% of retail investors open positions near the liquidation threshold, while institutional accounts have their take-profit and stop-loss levels 300% lower than retail investors. Tesla uses contracts to hedge lottery risks, and European companies use perpetual contracts to consume retail investors’ margins. The essence of contracts is the ultimate form of zero-sum games: every penny you earn comes from the liquidation notices of opposing accounts. The higher the leverage, the greater the potential profit, but the risk of losing principal also increases. Exchanges use insurance funds to subsidize liquidations, and large players collude to manipulate mark prices. Data from a certain blockchain shows that 30% of liquidations on a leading exchange are targeted explosions from an IP cluster. When contracts become a form of spiritual opium.

When leverage becomes a noose, in this zero-sum game, are you the hunter or the prey?#BNB创新高 $BTC