In a recent blog post released by BitMEX Research, they have decided to explain why the BitMEX insurance fund is needed and how it operates. According to the report, crypto platforms that offer leverage have some challenges that other firms do not have. The first thing that they mention is that when investors trade on derivatives exchanges such as BitMEX, users are not trading against the platform. BitMEX is just a company that allows individuals to exchange derivatives contracts with other third parties. As the exchange explains, the combination of offering both leverage and the ability for traders to trade against each other implies that winners might not receive the profits they expect. Because of this leverage, losers may not have enough margin in their positions and pay the winners. There are some traditional exchanges such as the Chicago Mercantile Exchange (CME) that do not have this problem. In these platforms, there
