What’s the difference between trading leveraged tokens and futures?
The core difference between leveraged tokens and futures is the rebalancing mechanism. Leveraged tokens have a rebalancing mechanism while futures doesn’t. Because of the rebalancing mechanism, leveraged tokens can’t be liquidated.
Instead of liquidation, the rebalancing mechanism will cause leveraged tokens to lose value before a liquidation could happen. (They can’t drop to zero, but they can lose 99% of their value!)
For more details about leveraged tokens, click here.