Important points
- Bybit has introduced a specialized insurance fund pool to enhance loss absorption and reduce unnecessary automatic deleveraging in USDT perpetual contracts.
- The new structure increases loss coverage per contract by more than 200% and features automatic thresholds and real-time monitoring.
According to an announcement on Tuesday, Bybit is upgrading its insurance fund system to reduce the frequency of automatic deleveraging events and provide stronger protection during times of high volatility.
This new mechanism introduces two specialized insurance fund pools. One is a new listing insurance fund pool that covers the first 30 days of a new USDT permanent listing, and the other is a portfolio insurance fund pool that supports up to nine contracts with correlated risk profiles.
This construct aims to increase the loss absorption capacity by more than 200% and effectively reduce the risk of ADL activation.
This rollout will expand to eligible trading pairs over approximately two months. While traders can monitor insurance fund data via the API, Bybit maintains the ability to intervene by adjusting thresholds or injecting capital during extreme market events.
