2025-03-11 11:39:02

#XRP5L deviates significantly from SpotXRP

XRP0,04%

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Tangyuanzz

· 2025-03-11 12:13

The rise in leveraged tokens is determined by the contract price, with the underlying supported by the contract price. Suppose there is a currency A, priced at 100, corresponding to A3L, priced at 1. We first let A rise by 10% and then fall by 10%, resulting in price changes of 100→110→99. Overall, the decline is 1%. Correspondingly, A3L should first rise by 30% and then fall by 30%, with price changes of 1→1.3→0.91, resulting in an overall decline of 9%. This is the reason for the inconsistency in the rise and fall. Extending this, it can also be concluded that in a volatile market, the wear and tear of the ETF will be more severe. If rebalancing occurs, the overall rise and fall will also change. We do not recommend users hold long-term because ETF leveraged tokens are only suitable for professional investors to conduct risk hedging or for short-term directional trading. They are not suitable for medium to long-term investments due to the existence of the rebalancing mechanism. Holding leveraged tokens for a long time carries extremely high risks, as the longer the duration, the greater the fluctuation, and the more capital is worn away.

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