Speaking of Bitcoin pin, the pin here is not a pin in the general sense. It refers to that the exchange manipulates the price in order to allow customers to open leverage contracts in the exchange. It can make the currency price suddenly rise or fall a lot, and seriously offset the specific price. However, the price will quickly return to the normal price level. The reason why it is called a pin is that its k-line diagram looks like a pin. Because a long shadow line up or down appears on the Bitcoin K-line diagram, people call this operation a pin. So, how did the Bitcoin pin come from? What impact will pins bring? Next, let's have a look.
The pin in the currency circle is that in the price shock of a digital currency, the price quickly rises or falls at a certain point in time, and then quickly returns to the normal price level. Digital currency is a kind of digital currency. Bitcoin became the first decentralized digital currency in 2009. After that, the word "digital currency" often refers to this kind of design.
Bitcoin is a virtual encrypted digital currency in P2P mode. The total number is very limited, only 21 million. Unlike all loan currencies, Bitcoin does not rely on a specific loan currency organization for sale. It is generated according to a specific algorithm and a large number of calculations. It is worth mentioning that the price of a single Bitcoin is very expensive.
Bitcoin was proposed on November 1, 2008 and officially launched on January 3, 2009. It is applicable to global 7 * 24 transactions. However, Bitcoin cannot be traded in China. In addition, Bitcoin can be traded on any computer connected to the Internet. No matter where you are, everyone can explore, buy, sell or deduct it.
Blockchain is an important concept of Bitcoin. At the same time, as the underlying technology of Bitcoin, it is a string of data blocks generated by using cryptographic methods. Features include decentralization, openness, self-consciousness, security, anonymity, etc.
Generally speaking, the situation of pins has no impact on the spot. Because the price change caused by pins is instantaneous, if it is operated by people, it cannot be followed in such a short time, and it does not affect the market quotation. Moreover, it belongs to the site price change of the exchange, and other exchanges will not have pins at the same time. Naturally, if you hang up an order with a very high price or a very low price in advance, it is possible to sell or buy coins at an incredible price when a pin occurs, but the probability is almost the same as buying the first prize in the lottery.
However, for the contractual leverage accounts, as they all have positions, once the price changes sharply, the compulsory position closing system may be started. Many exchanges use their own "site transaction price" as the basis for considering position risk. Therefore, once the pin appears, the customer will be forcibly exposed, causing heavy losses.
In fact, there are many reasons for the "pin", which may be caused by the lack of trading depth of the exchange, or the lack of sound trading mechanism of the exchange. It may even be artificial manipulation of prices. Therefore, many contract investors are very sick of the "pin". They are very excited when they hear the pin. Because they usually think that the reason for the pin is that the exchange is manipulating the price maliciously to gain rights and interests.
To sum up, exchanges should make efforts to prevent the occurrence of pins. It is often seen that some exchanges say that their security is very high when they publicize to the outside world. According to some technical means or mechanism design, pins can be avoided.
Speaking of this, I believe you have a certain understanding of how the Bitcoin pin came into being and what impact it will bring. In general, a better way to deal with the pins in contract trading is to use external index prices. In short, it is to judge the price of position risk, not according to the site price of their own exchanges, but to select the prices of many credible large exchanges around the world, based on the weighted average index prices, and should also be equipped with some fault tolerance mechanisms, For example, if the price of an exchange is abnormal (such as a pin), it can be automatically removed. In this way, even if there is a pin in the market price of the exchange, the compulsory position closing will not be started, causing losses to investors.