If a venue cannot explain a control, you cannot manage the risk it creates. Testing guide: use small-size experiments to validate edge cases before deploying serious capital. Test marks vs index under fast moves, then test liquidation math with fees and conservative slippage assumptions. When risk limits are tiered, confirm how tiers are computed and updated. Silent tier changes can invalidate backtests. Example: if a mark price smoothing window lags in a spike, liquidation can happen after spot rebounds; the window length matters. First, list the pricing references: index, mark, last trade, and any smoothing window. Then locate which reference drives margin checks. Then test degraded mode: what changes when rate limits tighten or when the venue throttles your order flow. Compute liquidation price twice: once including fees and conservative slippage, and once with optimistic assumptions. The gap is your uncertainty budget. Use position concentration warnings as a sizing input. Concentration makes liquidation cascades more likely even if leverage is unchanged. When in doubt, reduce complexity and size, and prioritize venues that publish definitions and failure-mode behavior. Aivora discusses these topics as system behavior: define inputs, test edge cases, and keep controls auditable. This is educational content about mechanics, not financial advice.
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.