Take the problem of leverage, i.e., when people trade on margin, or borrowing money they have to pay back. Without going into detail, the math behind leverage is such that gains and losses increase linearly while risk increases quadratically. In other words, if you have 5x leverage you only gain or lose 5x against a given price movement, but your risk of being liquidated increases by 25x. Leverage, by its nature via math, sets the house up to win.

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• Source: https://www.coindesk.com/consensus-magazine/2023/01/27/defi-web-3-regulation-policy/?utm_medium=referral&utm_source=rss&utm_campaign=headlines