⚠️Platform Risk Protections

The largest risk in our platform design is a large directional move with the majority of traders taking the winning side.

We've commonly seen "black swan" events drive massive downside moves in the market. Consider times when the overall space has fallen by almost 50% in a short time.

For the Lamda.exch 2.0 platform release, we are developing two mechanisms to mitigate this risk:

1. Limits on the amount of long and short positions that can be opened. This system needs to take into account liquidation levels and leverage used on both sides, as well as the size of the liquidity pool in relation to open positions. There should be some form of parity between both sides of traders.

2. An auto deleveraging system to close or reduce positions if they become too risky. Auto deleveraging should prioritise positions with high leverage and the most unrealised profit. A watcher node will be developed to monitor open positions.

Auto Deleverage Priority:  P&L % * Leverage (when P&L is positive)
                           P&L % / Leverage (when P&L is negtive)

We'll add more details as we further develop this system for the 2.0 release. Due to development time constraints, these protections cannot be included in Lamda.exch 1.0.