Socialized loss
A socialized loss occurs when a deficit that one party cannot cover is spread across other users of the same venue or pool, through haircuts on deposits, reduced payouts, or auto-deleveraging. It reveals who actually bears tail risk in a system, which is often not the party that took it.
Steadyrain analysis covering this term
- The Great Crashes, Part 3 — 10/10, The $19B Day Jul 13, 2026
- Hyperliquid and the Anatomy of Perpetual-Vault Risk May 11, 2026