Where does your money go when you get liquidated? 😵

Here 👇

1️⃣ The exchange (Binance) collects the liquidation fee, which is part of the trader's collateral.

2️⃣ Counterparties (other traders on the opposite side of the trade) can benefit because the trader's position is sold to cover their profits.

3️⃣ If there is any extra money left after covering the liabilities and fees, it can be paid into Binance's insurance fund, which protects the system from losses in extreme situations.

So, Binance and other traders who took the opposite side of the liquidated trade are the ones who benefit. Binance takes the fee and the counterparties get their profits.

#FutureTarding

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