“Like every borrowing position, Alice pays interest on her debt.”. That's not entirely correct. On @protocol_fx, you don’t pay interest on the debt, but rather a small opening fee (0.5%) and a closing fee (0.2%). That’s it. Even with the very low interest rates that are also available on Llamalend, there’s no match for medium and long-term positions: f(x) is simply the most economical and safest solution (see @PharosWatch). And f(x) also protects against liquidations by automatically rebalancing the position. What do you say—shall we conduct a real-world comparison test between the two protocols by opening a few positions at risk?

Life as a trader is easy, huh, anon? They’ve told you and shown you that with just a few dollars, you can make a fortune in no time. Now we have some memecoins that are skyrocketing in market cap, and some of them are even up 94%, so you think: “Well, that must be how it is; they were right.” But maybe… If it were that simple, if everyone were constantly making money, if all it took was throwing $2 at the first animal with a hat that came along, then why aren’t we all rich? But maybe… Deep down, things aren’t quite like that. Maybe all it takes is a “targeted” sell-off, and that 94% plummets to 5–10% if everything goes well. Maybe drawing two lines on a chart isn’t enough to start making money. Maybe “guessing” the movement of your favorite coin isn’t even enough to make money, to be honest. In a declining $BTC market, on Hyperliquid over the last 24 hours we’ve seen a total of about $69M in liquidations, 53% of which were short positions. Yes, that’s right. The market is falling, and the ones getting liquidated the most are precisely those who bet it would go down. Traders who correctly predicted the direction but got everything else wrong. Leverage, margin, and almost certainly: timing. Because in such a volatile market, high leverage combined with bad timing is deadly. All it takes is half a swing, and you’re liquidated. And the game is over. If you lose enough to buy a pizza, it doesn’t matter much. If you lose the means to support yourself and your family, then it certainly matters. That’s why you periodically see me preaching here on X, the least suitable platform for the task. A healthy dose of risk management should be part of the daily routine for anyone who trades: without oversimplifying things, identifying the right direction, performing a risk-reward (R/R) analysis for each trade, using the right margin, and keeping leverage low are the bare minimum required to survive in the market. I’m not a professional trader; I make only a few trades a month, and almost none with a time frame shorter than daily. In short, I focus on the medium to long term—weeks or months. If a trade goes wrong for me, it’s usually due to either unpredictable and extreme external factors or, more likely, because I completely misjudged the direction or timing. While there’s little I can do about the former beyond having good risk management, for the latter I use @protocol_fx: if the two main factors causing me to lose a trade are getting the direction or timing wrong, my only ally is TIME. I need time to get back on the right track, weathering the ups and downs BUT STAYING IN THE GAME. And here we have the two problems that @protocol_fx solves: liquidations and the funding rate. If I’ve made a major mistake, the liquidation protection mechanism rebalances my trade. Sure, I incur a temporary loss, but I stay in the game. And the absence of a funding rate (normally) prevents my position from being bled dry to the point of becoming practically nonexistent. I stay in the ring fighting, battered, but still standing. This is why you always hear me talking about them. They’ve solved my trading operational issues. I’ve never kept statistics on my trades (a huge mistake, but nobody’s perfect and I’m already handsome, likable, smart, and…), but I can assure you that I’ve gone from a decent 45–50% win rate to nearly 60–65%. Same mindset, same trades, different instrument, different results.

So Dave… you opened a 7x leveraged short on highly volatile $ETH Yep. Then $ETH pumped +3% in no time. Yep. And you got completely liquidated. Yep. You do know that with @protocol_fx, you would’ve been rebalanced instead of liquidated… and stayed in the game. Yep. …So why the hell didn’t you use it?

This is a sad statement. Billions are lost in hours. I see someone rage bait and be happy about this or about “scam” coins being smashed. Reality is that someone will suffer tremendous pain because his money is gone. Moments like this must teach everyone to be cautious with leverage and have good risk management. Good risk management means also using the right tools. One of these is @protocol_fx that has liquidation breaks (you will be rebalanced, non-liquidated) so you will have another and another possibility again. Stay safe out there, bad times ahead…