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Margin Requirements

Each product has published initial and maintenance margin levels:
  • Initial Margin – required to open a position
  • Maintenance Margin – required to keep it open

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Leverage

Leverage depends on margin levels and varies by product.

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Accepted Collateral

Initially USD, with support for stablecoins (e.g., USDC).
All contracts remain USD-denominated.

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Liquidation

Triggered when account collateral falls below maintenance margin, resulting in position closure. Liquidations are triggered by automated monitoring for margin breaches combined with human manual review, providing an important safeguard to ensure a consistent and reliable liquidation processes.

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Margin Calls

Issued when collateral approaches maintenance margin.
Brokers may have additional margin call processes.

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Avoiding Liquidation

Maintain collateral above maintenance margin by:
  • Depositing more funds
  • Reducing open positions

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Margin Calculation Example

I have a new account and have deposited $500. Let’s say EXAMPLE-PERP is trading at a price of $5.25, with an Initial Margin Requirement of 8% (12.5x leverage) and a Maintenance Margin Requirement of 4% (25x leverage). I want to buy 1,000 contracts of EXAMPLE-PERP. In order to send an order of quantity 1,000, the Initial Margin Requirement for my order would be 1,000 contracts * $5.25 * 8% = $420. Thus, my account would have to have at least $420 of account equity in excess of the current initial margin utilization in order to be able to send this order. Since my current account equity is $500 and my current initial margin utilized is $0 (I have no other orders or positions), I have $500 of initial margin available and can successfully send this order. Once my order is filled, and now I have a position of long 1,000 contracts of EXAMPLE-PERP. My account equity will be $500, my initial margin requirement is $420 (1,000 contracts * $5.25 price * 8% contract’s initial margin requirement), and my maintenance margin requirement is $210 (1,000 * $5.25 * 4%). I have $80 of remaining initial margin available to send additional orders if I so desire. I must maintain an account equity of at least $210 in order to avoid liquidation. Let’s say now the price of EXAMPLE-PERP drops to $4.90. I will have an unrealized loss of $350: 1,000 contracts * ($4.90 - $5.25) = -$350. My account equity thus will be $150. My initial margin requirement is $392 (1,000 contracts * $4.90 * 8%) and my maintenance margin requirement is $196 (1,000 contracts * $4.90 * 4%). Because my available initial margin is less than $0 ($150 - $392 < $0), I will be unable to increase my position size and thus cannot send new buy orders. Because my account equity is below the maintenance margin required ($150 < $196), my EXAMPLE-PERP position will be subject to liquidation.