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Why Is the Time Window for a Margin Call Often Very Short in Crypto Trading?

Due to 24/7 crypto volatility, a short window is necessary to prevent rapid erosion of margin and negative balances.
Greeks.Live22.11.25

Why Is the Time Window for a Margin Call Often Very Short in Crypto Trading?

The time window is short due to the extreme 24/7 volatility of the crypto market. Unlike traditional markets, crypto prices can move significantly in minutes, rapidly eroding the margin buffer.

A short time window minimizes the exchange's risk of a position falling into a negative balance. Many crypto exchanges bypass the traditional margin call altogether, opting for immediate auto-liquidation to protect their solvency.

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