Looking at the market or crashing? Someone endured 4 days of holding, only to see their 1000U be eaten away by funding fees, and right after closing the position, the market surged—this heartbreaking scenario has happened countless times.

Why are those who only watch K-line charts most likely to get liquidated? Because they simply don’t understand the 5 major pitfalls of contracts. Digging into these is the key to surviving longer.

**First Pitfall: Funding Rate is an Invisible Vampire**

Perpetual contracts charge funding fees every 8 hours, paid between longs and shorts. It sounds simple, but those holding full positions and stubbornly resisting often suffer the most. Even if the direction is correct, high funding fees can severely damage the principal. Someone’s BTC was sideways for a week with no movement, but their principal was eaten up by funding fees, leading to liquidation. The solution is straightforward: avoid high-fee periods; don’t hold positions longer than 8 hours; or rely on earning funding fees to stay afloat.

**Second Pitfall: Liquidation Price is Closer Than You Think**

Many believe that 10x leverage means liquidation occurs only at a 10% drop—that’s completely wrong. The platform’s fees push the liquidation line upward. Under a mode where every trade is monitored in real-time, a sudden jump in the market can cause high-leverage positions to be instantly breached. To avoid this: use isolated margin instead of cross margin; keep leverage between 3-5x; and always leave enough margin buffer.

**Third Pitfall: High Leverage Looks Good, But It’s a Trap**

10x leverage earns quickly, but also loses just as fast. Someone turned 50,000 into 300,000, then used 10x leverage to bottom-fish, and wiped out to zero in an hour. This is not a myth; it’s common. High leverage is only suitable for short-term trading; long-term is doomed. Never exceed 10x leverage—learned the hard way.

**Fourth Pitfall: Platforms’ Tricks Are Hard to Defend Against**

Not all exchanges follow the rules. Some manipulate prices or create false liquidity, and in extreme market conditions, they might liquidate your profitable positions. What to do? Choose reputable exchanges, check their risk reserve status, and see if they have a history of liquidating profitable positions unfairly.

**Fifth Pitfall: The Most Terrifying One Is Your Own Psychology**

The biggest danger is trading contracts with living expenses. Frequent monitoring, trading against the trend, emotional trading—these are signs of self-destruction. Solutions: set a daily loss limit and stop trading when reached; keep your trading account separate from your living expenses.

**Final Words: Contracts Are a Risk Control Game, Not Gambling**

Understanding the rules is essential for survival. The survival principles are simple: clarify the rules and avoid betting on directions; only invest spare funds, not all-in; study every detail carefully.