BTCUSD moving inside uptrend channel but the last downward movement is swallowed by all previous growth. Binance stopped the fall of Bitcoin - forcibly closing short positions for many traders - including my deal. My short was from 9700 and closed forcibly at 8500. Now I understand that we can break the support line of this channel and drop to a minimum of 38.2 level Fibonacci I don’t think that we will fall quickly, but we can expect a slow exhausting fall
Best regards EXCAVO
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Well, I see many interested in this situation. In general, it was like this: I traded in binders futures and I had a short without take-profit. There was a big downward movement. I decided to look at the situation and I see lagging on Binance, after 1-2 min I did not find my open deal, but I saw that the position was close at a price of 8575.93 with a description of the reason for the closure of "Deleverage"
I believe it's perfectly legal. In order for you to be able to short with leverage, there must be matching long positions. If matching long positions were closed then the exchange MUST automatically close your shorts since there's a risk of exchange insolvency.
You're not trading against the exchange, you're trading with other traders.
heres some facts for you: any trading platform/exchange is required by law to be a fiduciary entity with oversight and licensing.
part of those laws state very clearly that no fiduciary asset owned by a client (in this case a short position) can be handled or altered by the exchange itself.
also, you clearly dont understand what shorts and longs are.
exchanges provide shorts and longs because they own a pool of excess coins. which they will sell or buy after a customer fills a short or long order.
(if you short, you are selling the exchanges bitcoin) (if you long, you are telling the exchange to buy bitcoin)
the position is then held at the price you shorted/longed. it is tied to your account margin which you have collateral to backup.
this is a trading service.
it is absolutely without question against the law for the exchange to force close a position if conditions of the position being force closed are not met. (eg: if your margin is still valid and you arent getting liquidated)
in this case, these customers were actually in PROFIT on their position, and the exchange force-closed them. they would have gotten more profit had the exchange not closed them.
this is 100% open and shut lawsuit.
and once again - no - there does not have to be anywhere near a balance of longs and shorts.
thats nonsense.
and its never been in balance either.
there have always been about 2x-3x more long positions than shorts, that is the normal balance for bitcoin.
Cool, but isn't there a legal clause that states positions can be closed if exchange insolvency is at risk? Or the counterparty to the trade is margin called?
I forget the legal name of this clause, because historically it has only been used by crypto exchanges; but it believe I read about it on the FT ... sorry it was quite some time ago. I'll do further research on this and get back to you.
Thx,
Putrid
ezpi
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@Putrid_Shittgenstein, "i forget the legal name" - youre just inventing nonsense thats why.
theres no such thing.
and a "clause" is a section put into a legal contract.
"clauses" do not exist in de facto law.
when you sign up to an exchange you agree to terms of service. they are a fiduciary however and cant just put anything in their terms. there are de facto standards they must abide by.
closing positions without knowledge of the owner of that position is highly illegal.
if i give my car to a company to repair it, can they just sell my car off without my knowledge?
no!
yes do more "research" because your legal terminology of very basic vocabulary is even way off.
Putrid_Shittgenstein
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@ezpi, I'm not pretending to be a lawyer; tho I can confirm that this is not new and it has happened before and the exchanges pointed to a clause in the terms of service. Are you a lawyer? And under what jurisdiction will you sue? Is this common law as practiced in Hong Kong? Are you familiar with common law?
that is frikkin illegal as hell.
are you using binance or binance.US??
I know a lawyer in NY that would love to hear from you, they are going to trial in a class action lawsuit against binance (and many other exchanges).