Definition ∞ Regulatory margin refers to the minimum amount of collateral required by financial regulators for certain leveraged trading positions. This requirement aims to mitigate systemic risk and protect market participants from excessive losses. It ensures sufficient funds are available to cover potential adverse price movements.
Context ∞ The application of regulatory margin requirements to digital asset derivatives markets is a significant area of discussion for financial authorities globally. Establishing appropriate margin levels for volatile crypto assets is crucial for balancing market innovation with investor protection and overall financial stability.
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