-
Bitcoin $83,918.5249
-1.85% - Ethereum
$1,581.2485
-2.99% - Tether USDt
$1.0000
0.01% - XRP
$2.0743
-3.55% - BNB
$579.5840
-1.37% - Solana
$125.4799
-4.99% - USDC
$1.0000
0.01% - TRON
$0.2542
2.42% - Dogecoin
$0.1532
-3.78% - Cardano
$0.6058
-4.94% - UNUS SED LEO
$9.3964
-0.35% - Chainlink
$12.1811
-3.14% - Avalanche
$18.8831
-5.08% - Stellar
$0.2339
-3.14% - Toncoin
$2.8495
-4.08% - Shiba Inu
$0.0...01162
-2.50% - Sui
$2.0764
-5.19% - Hedera
$0.1576
-4.85% - Bitcoin Cash
$320.4674
-3.22% - Litecoin
$75.2096
-2.87% - Polkadot
$3.5156
-3.68% - Dai
$1.0002
0.02% - Bitget Token
$4.2993
-0.38% - Hyperliquid
$15.1677
-6.18% - Ethena USDe
$0.9993
0.02% - Pi
$0.6229
-7.94% - Monero
$217.5469
1.67% - Uniswap
$5.1595
-4.11% - OKB
$52.2699
-0.13% - Pepe
$0.0...07109
-2.67%
How is the currency-standard liquidation price of a perpetual contract calculated?
The currency-standard liquidation price is calculated by subtracting the maintenance margin percentage from the current market price of the underlying asset.
Oct 24, 2024 at 11:49 am
How is the Currency-Standard Liquidation Price of a Perpetual Contract Calculated?
A perpetual contract is a futures contract that does not have an expiry date. It is usually used to take a leveraged position on the underlying asset. The liquidation price is the price at which the exchange will liquidate your position if you do not have enough margin to cover your losses.
The currency-standard liquidation price is the price at which the exchange will liquidate your position if the value of the underlying asset moves against you by a certain percentage. This percentage is called the maintenance margin.
Steps on how to calculate currency-standard liquidation price
- Determine the maintenance margin. This is usually expressed as a percentage, such as 10% or 20%.
- Calculate the value of your position. This is the number of contracts you are holding multiplied by the current market price of the underlying asset.
- Calculate the liquidation price. This is the current market price of the underlying asset minus (or plus, if you are short) the maintenance margin.
For example:
Let's say you are holding 10 perpetual contracts on Bitcoin, and the current market price of Bitcoin is $10,000. The maintenance margin is 10%.
Step 1. Determine the maintenance margin: 10%
Step 2. Calculate the value of your position: 10 contracts x $10,000 = $100,000
Step 3. Calculate the liquidation price: $10,000 - (10% x $10,000) = $9,000
This means that if the price of Bitcoin falls to $9,000, the exchange will liquidate your position.
It is important to note that the liquidation price can change as the market price of the underlying asset changes. If the market price moves in your favor, the liquidation price will increase. If the market price moves against you, the liquidation price will decrease.
You can use a liquidation price calculator to quickly and easily calculate the liquidation price for your perpetual contract.
Disclaimer:info@kdj.com
The information provided is not trading advice. kdj.com does not assume any responsibility for any investments made based on the information provided in this article. Cryptocurrencies are highly volatile and it is highly recommended that you invest with caution after thorough research！
If you believe that the content used on this website infringes your copyright, please contact us immediately (info@kdj.com) and we will delete it promptly.
- 5 Altcoins That Will Explode This Week
- 2025-04-16 19:25:13
- Shiba Inu (SHIB) Remains the #2 Memecoin on CoinMarketCap, Trailing Only Dogecoin (DOGE)
- 2025-04-16 19:25:13
- 4 Cryptos Shaking Up the Markets and Giving Users Real Utility
- 2025-04-16 19:20:12
- Toobit Expands Its Services by Partnering with NovaMeme, a Cutting-Edge IDO-to-Market Decentralized Finance (DeFi) Fundraising Platform
- 2025-04-16 19:20:12
- Bitcoin (BTC), Pi Network's Pi Coin, and PepeX (PEPX) Are Experiencing a Rebound After US President Donald Trump's Tariff-Induced Market Plunge
- 2025-04-16 19:15:13
- 3 Under-the-Radar Cryptos That Could 10x or 100x
- 2025-04-16 19:15:13
Related knowledge
How does Tail Protection reduce the loss of liquidation?
Apr 11,2025 at 01:50am
Introduction to Tail Protection in CryptocurrencyTail Protection is a mechanism designed to mitigate the risks associated with liquidation in cryptocurrency trading. Liquidation occurs when a trader's position is forcibly closed by the exchange due to insufficient margin to cover potential losses. This often happens in leveraged trading, where traders b...
What are the consequences of an imbalance in the long-short ratio?
Apr 13,2025 at 02:50pm
The long-short ratio is a critical metric in the cryptocurrency trading world, reflecting the balance between bullish and bearish sentiments among traders. An imbalance in this ratio can have significant consequences on the market dynamics, affecting everything from price volatility to trading strategies. Understanding these consequences is essential fo...
How to judge the market trend by the position volume?
Apr 11,2025 at 02:29pm
Understanding how to judge the market trend by position volume is crucial for any cryptocurrency trader. Position volume, which refers to the total number of open positions in a particular cryptocurrency, can provide valuable insights into market sentiment and potential price movements. By analyzing this data, traders can make more informed decisions ab...
Why does a perpetual contract have no expiration date?
Apr 09,2025 at 08:43pm
Perpetual contracts, also known as perpetual futures or perpetual swaps, are a type of derivative product that has gained significant popularity in the cryptocurrency market. Unlike traditional futures contracts, which have a fixed expiration date, perpetual contracts do not expire. This unique feature raises the question: why does a perpetual contract ...
Why is the full-position mode riskier than the position-by-position mode?
Apr 13,2025 at 03:42pm
Why is the Full-Position Mode Riskier Than the Position-by-Position Mode? In the world of cryptocurrency trading, the choice between full-position mode and position-by-position mode can significantly impact the risk profile of a trader's portfolio. Understanding the differences between these two modes is crucial for making informed trading decisions. Th...
How is the liquidation price calculated?
Apr 12,2025 at 01:35am
Introduction to Liquidation PriceLiquidation price is a critical concept in the world of cryptocurrency trading, particularly when dealing with leveraged positions. Understanding how this price is calculated is essential for traders to manage their risk effectively. The liquidation price is the point at which a trader's position is forcibly closed by th...
How does Tail Protection reduce the loss of liquidation?
Apr 11,2025 at 01:50am
Introduction to Tail Protection in CryptocurrencyTail Protection is a mechanism designed to mitigate the risks associated with liquidation in cryptocurrency trading. Liquidation occurs when a trader's position is forcibly closed by the exchange due to insufficient margin to cover potential losses. This often happens in leveraged trading, where traders b...
What are the consequences of an imbalance in the long-short ratio?
Apr 13,2025 at 02:50pm
The long-short ratio is a critical metric in the cryptocurrency trading world, reflecting the balance between bullish and bearish sentiments among traders. An imbalance in this ratio can have significant consequences on the market dynamics, affecting everything from price volatility to trading strategies. Understanding these consequences is essential fo...
How to judge the market trend by the position volume?
Apr 11,2025 at 02:29pm
Understanding how to judge the market trend by position volume is crucial for any cryptocurrency trader. Position volume, which refers to the total number of open positions in a particular cryptocurrency, can provide valuable insights into market sentiment and potential price movements. By analyzing this data, traders can make more informed decisions ab...
Why does a perpetual contract have no expiration date?
Apr 09,2025 at 08:43pm
Perpetual contracts, also known as perpetual futures or perpetual swaps, are a type of derivative product that has gained significant popularity in the cryptocurrency market. Unlike traditional futures contracts, which have a fixed expiration date, perpetual contracts do not expire. This unique feature raises the question: why does a perpetual contract ...
Why is the full-position mode riskier than the position-by-position mode?
Apr 13,2025 at 03:42pm
Why is the Full-Position Mode Riskier Than the Position-by-Position Mode? In the world of cryptocurrency trading, the choice between full-position mode and position-by-position mode can significantly impact the risk profile of a trader's portfolio. Understanding the differences between these two modes is crucial for making informed trading decisions. Th...
How is the liquidation price calculated?
Apr 12,2025 at 01:35am
Introduction to Liquidation PriceLiquidation price is a critical concept in the world of cryptocurrency trading, particularly when dealing with leveraged positions. Understanding how this price is calculated is essential for traders to manage their risk effectively. The liquidation price is the point at which a trader's position is forcibly closed by th...
See all articles
