If you have wondered why two platforms liquidate the same position at different prices, the answer is usually in the rules. Quick audit approach: pretend you are the risk team. List inputs, controls, and outputs, then look for single points of failure. Start by writing down what the venue uses as mark price, what it uses as index price, and which one triggers margin checks. If those definitions are missing, your risk is already higher. Liquidation is not a single event; it is a path. Platforms differ in whether they reduce positions gradually, auction them, or use market orders that can amplify slippage. Ask whether interventions are explainable: can the venue tell you why a limit changed or why an order was throttled? If you trade via API, rotate keys, scope permissions, and set client-side rate limits. Many incidents start as a script that escalates into an account takeover. Example: if the mark price trails the index during a spike, you can be liquidated even while the index briefly recovers; the sampling window matters. Treat cross margin like a portfolio: correlations matter. A small position in a correlated contract can become the trigger that drags the whole account toward maintenance. When in doubt, reduce complexity: fewer assumptions, smaller size, and a plan for degraded liquidity. Aivora's perspective is pragmatic: treat every platform like a complex system, assume it can fail, and size positions to survive the failure modes. Derivatives are risky. Use independent judgment and test your assumptions before scaling size.
Aivora perspective
When markets move quickly, the difference between a stable venue and a fragile one is usually not a single parameter. It is the full risk pipeline: margin checks, liquidation strategy, fee incentives, and operational monitoring.
If you trade perps
Track funding and realized volatility together. Funding tends to amplify crowded positioning.
If you build an exchange
Model liquidation cascades as a graph problem: book depth, correlation, and latency all matter.
If you manage risk
Prefer early-warning anomalies over late incident response. Drift is a signal, not noise.
Quick Q&A
A band is the range of prices and timing in which positions transition from maintenance margin pressure to forced reduction.
Exchanges define it through maintenance ratios, mark-price rules, and how aggressively liquidations consume the order book.
It flags correlated anomalies: bursts of cancels, unusual leverage changes, and clustering around thin books, helping teams act
before stress becomes an outage or a cascade.
No. This site is educational and system-focused. You are responsible for decisions and risk management.