Liquidation Mechanism

1.What Is Liquidation?

When the account margin is insufficient to maintain open positions, the system will automatically liquidate positions to prevent the account balance from becoming negative.

Liquidation Trigger: Liquidation occurs when the Margin Ratio ≥ 100%.

2.Key Risk Indicators

• Margin Ratio: Indicates the overall risk level of a position
• Warning Margin Ratio (≥ 90%): Triggers system risk alerts
• Estimated Liquidation Price: For reference only; not the actual execution price

3.Liquidation Fees

During liquidation, a liquidation fee is charged and transferred to the Insurance Fund, which is used for system-wide risk management.