How Can a Derivatives Protocol Mitigate the Risk of Network Congestion? ▴ Learn

How Can a Derivatives Protocol Mitigate the Risk of Network Congestion?

Protocols can mitigate congestion risk by deploying on high-throughput Layer-2 solutions or alternative Layer-1 chains. They can also implement dynamic fee mechanisms, batch transactions, and utilize decentralized off-chain order books with on-chain settlement.

These measures ensure that critical functions like liquidations and margin updates can be processed quickly even during peak network demand.

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