Yi Lihua: It is recommended that trading platforms establish a liquidity management fund to avoid liquidity exhaustion caused by extreme situations

ChainCatcher news, Liquid Capital (formerly LD Capital) founder Yi Lihua posted on social media that the overall market has seen liquidations amounting to hundreds of billions of dollars, primarily affecting market makers and active traders, causing damage to the market far beyond imagination.

Especially for the altcoins that have been wiped out in one click, it will take a long time to restore investor confidence and liquidity. It is strongly recommended that trading platforms allocate a portion of their profits to establish a liquidity management fund to avoid extreme situations where liquidity is exhausted and goes to zero. The Federal Reserve also has market regulation functions, and it is believed that platforms making tens of billions in annual profits have the ability and responsibility to establish such mechanisms. Otherwise, the market will suffer devastating damage, and the injured will not only be platform users but also the market and the trading platforms themselves.