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What Is the Risk of Relying Solely on Historical Data for Stress Testing Crypto Markets?

Limited historical data may not capture future extreme events or crisis correlations, risking underestimation of losses and insufficient margin.
Greeks.Live15.11.25

What Is the Risk of Relying Solely on Historical Data for Stress Testing Crypto Markets?

Crypto markets are nascent and highly dynamic, meaning historical data is limited and may not capture the full range of potential future extreme events. Relying solely on past data risks underestimating the severity of a future crash or the correlation between assets during a crisis, leading to insufficient margin and potential systemic risk.

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