Global economic crises can push investors toward crypto as a hedge, creating short-term opportunities, but volatility and risk remain high.
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A flash loan is a type of uncollateralized loan offered in DeFi platforms, where users can borrow assets for a very short period—usually within a single transaction. The key feature of a flash loan is that it must be repaid by the end of the transaction. If the borrower does not repay the loan, the transaction is reversed. Flash loans are often used for arbitrage opportunities, debt refinancing, or to exploit price differences across decentralized exchanges. They offer users the ability to access large amounts of capital without needing collateral, but they also carry risks, particularly for less experienced users, as they can be used for market manipulation if exploited maliciously.
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Risk management in cryptocurrency requires a strategy to protect against market volatility. First, diversify your portfolio across different cryptocurrencies to reduce exposure to any single asset. Set stop-loss orders to automatically sell your holdings if the price drops below a certain level, minimizing potential losses. Only invest what you can afford to lose, and avoid using leverage unless you fully understand the risks. Regularly review your investments, and adjust your strategy as market conditions change. Keeping emotions in check and sticking to your predetermined plan is key to surviving crypto’s highs and lows.
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