Calculate crypto liquidation prices and margin top-ups for cross or isolated positions using balance, notional, entry price, leverage, and MMR.

All balances and notionals use USD; prices use USD per underlying unit.

Educational single-position model: linear USD-collateral contract, fixed maintenance = MMR ร— entry notional. Excludes other positions, fees, funding, tiers and changing collateral. Exchange liquidation prices can differ.

Collateral available at entry, excluding this positionโ€™s unrealized P&L.

Illustrative default 0.5%; enter the applicable exchange rate. Presets are not verified coin-specific tiers.

Cross Margin Liquidation Formula

The following equations are a simplified way to estimate a cross margin liquidation price for a single position with a linear, USD-collateral contract and maintenance fixed at MMR times entry notional (ignoring fees, funding, changing collateral and other open positions). Many exchanges use additional exchange-specific rules, so your actual liquidation price may differ.

LPlong & = E(1 + MMR - (B) / (P)) \ LPโ‚›โ‚•โ‚’แตฃโ‚œ & = E(1 - MMR + (B) / (P))
  • Where LP is the liquidation price (USD per unit)
  • E is the entry price (USD per unit)
  • B is collateral available at entry, excluding this positionโ€™s unrealized P&L (USD)
  • P is the position notional value at entry (USD)
  • MMR is the maintenance margin rate (as a decimal, e.g., 0.5% = 0.005)

To estimate the cross margin liquidation price, compute the ratio B/P (your margin fraction, which equals 1 / implied leverage), then apply the appropriate long/short equation using the entry price and maintenance margin rate.

What is a Cross Margin Liquidation?

Definition:

A cross margin liquidation occurs when the margin in a traderโ€™s account is no longer sufficient to support a leveraged position across all open trades, causing the positions to be force-closed to prevent further losses.

How to Calculate Cross Margin Liquidation?

Example Problem:

The following example outlines the steps and information needed to estimate the Cross Margin Liquidation Price (for a single position, simplified).

First, determine your total account balance (collateral available). In this example, the balance is $100.

Next, identify the position notional and entry price. Here, the position is 10 units entered at $400 per unit, so the position notional is P = 10 ร— $400 = $4,000. Assume a maintenance margin rate of 0.5% (MMR = 0.005) and a long position.

Finally, calculate the liquidation price using the formula above:

LPlong = E ร— (1 + MMR โˆ’ B/P)

LP = $400 ร— (1 + 0.005 โˆ’ ($100 / $4,000))

LP = $400 ร— (1.005 โˆ’ 0.025) = $400 ร— 0.98 = $392

FAQ

How does cross margin liquidation differ from isolated margin liquidation?

In cross margin mode, a traderโ€™s entire available balance is used to help maintain positions, which can reduce the chance that a single position is liquidated compared to isolated margin. However, if liquidation occurs in cross margin, it can affect other positions in the account because all positions share the same collateral pool.

What factors can affect the liquidation point in cross margin trading?

Factors such as total account equity (including unrealized P&L), position size, entry price, market volatility, maintenance margin requirements, and exchange-specific fees/rules can all impact when a cross margin liquidation occurs.

How does a Cross Margin Liquidation Calculator help traders?

A Cross Margin Liquidation Calculator helps traders estimate a potential liquidation point by considering account balance, position size, entry price, and maintenance margin rate. This can help with risk management, but actual liquidation prices may differ by exchange and by whether fees, funding, and multiple open positions are included.