18 years ago, Binance did not have any contracts, and the main battlefield was on OK and Bitmex. Previously, the exchange did not have a liquidation and takeover mechanism, and it was directly linked to market depth. If the liquidation order is not taken, it is a liquidation and will move down or up in the next settlement cycle. Introduce the 50000 Brother incident, you will understand. In July 2018, OK had a super large investor (at that time OK also had a position list, known as the pig killing list). This super large investor started crazily long with a leverage of 20x from 7000 until it reached 8400, and then moved all the margin. At the same time, during the process of pulling the market, he went crazy short on Bitmex (due to the spread out mechanism, he couldn't go short on OK). So, after he removed the margin, he went bankrupt, with 50000 BTC sell orders (shown in yellow) directly hanging on 8020. At this point, the market took a sharp downturn, and the actual contract positions were not equal. Short positions would have 50000 more positions than long positions because there were no leftovers. So there will be a very obvious problem, if the market continues to decline, the profit from short positions will be higher than that from long positions. What should we do about this gap? Previously, all short position holders shared the loss of this long position together. At that time, the loss from overstocking was probably 35%, which was too exaggerated. Many people suffered losses from hedging, so in the end, Xu Mingxing personally subsidized more than 1000 BTC Then in the next settlement cycle, this liquidation order will be lowered to the current price of 7200. Since then, the OKX contract system has gradually improved, adl， Ladder margin, floating profit margin that cannot be moved, and liquidation of liquidated damages are all measures to limit the risk of this type of liquidation.