@necktie-fete-0l
The surge in cryptocurrency derivatives trading volume surpassing spot markets has heightened volatility due to leveraged positions amplifying price swings. Derivatives offer hedging tools like futures and options, enabling investors to mitigate risks. Investors can use these instruments to lock in prices or hedge against downturns, but must manage leverage carefully to avoid liquidations. Monitoring open interest and funding rates helps gauge market sentiment for informed hedging strategies.
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