What factors should be considered when choosing between cash settlement and physical settlement in the cryptocurrency market?

1 answers

• Dec 25, 2021 · 3 years ago
  When it comes to choosing between cash settlement and physical settlement in the cryptocurrency market, it's essential to consider the counterparty risk. Cash settlement involves relying on the exchange or platform to fulfill the cash payment, which introduces the risk of default or insolvency. On the other hand, physical settlement allows you to take possession of the actual cryptocurrency, reducing the reliance on third parties. This can be particularly important in cases where the exchange or platform is not well-established or has a history of security breaches. By taking physical settlement, you have more control over your assets and can store them in a secure wallet. However, it's important to note that physical settlement also comes with its own risks, such as the potential loss or theft of the cryptocurrency. It's crucial to assess the credibility and security measures of the exchange or platform before making a decision.
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