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When a position’s margin falls below the minimum maintenance requirement, Everstrike begins liquidating it incrementally — reducing the position in steps rather than closing it all at once. This approach gives the market time to absorb the selling pressure and gives you a window to add margin and halt the process. Liquidation stops as soon as your margin meets the maintenance requirement again. Read Margin Requirements for the applicable minimum margins for each contract type.

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When Liquidation Starts

Liquidation starts when Gross Position Margin falls below the Minimum Maintenance Margin requirement for a position.
  • With Cross Margin (the default), the system evaluates your account-wide margin across all positions. A single undercollateralized position can affect the whole account.
  • With Isolated Margin, the system evaluates each position independently. Only the affected position enters liquidation.

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How Liquidation Works

1

System takes temporary control

Everstrike temporarily assumes control of the position selected for liquidation. You cannot manually submit or cancel orders for that position during this period.
2

Market conditions are assessed

The system evaluates current market depth, the estimated average fill price, and recent trade executions to determine whether an acceptable close-out price is achievable.
3

IOC order is submitted

If conditions support a reasonable close-out, the system submits an Immediate Or Cancel (IOC) order on your behalf.
4

Position and margin requirement are reduced

A filled order reduces the position size. The maintenance margin requirement decreases proportionally.
5

Control returns when margin is restored

Once your margin meets the maintenance requirement, the system returns control of the position to you. If margin is still insufficient, the process repeats from Step 1.

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Liquidation Order Size

Each liquidation order uses the following notional value:
Each order is at least 10% of the position’s USD notional and at least 1,000 USD where possible. It never exceeds the remaining position value. This incremental sizing reduces the market impact of forced closes.

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During Liquidation

While a position is in liquidation, the trading interface shows a warning beside that position. You cannot submit or cancel orders for that position until liquidation ends.
You can still add margin while liquidation is active — doing so may return the position to compliance and halt the process:
  • With Cross Margin — deposit additional assets into your trading account to increase your account-wide margin.
  • With Isolated Margin — add margin directly to the affected position by dragging the leverage slider to the left.
Keep the following restrictions in mind during an active liquidation:
  • You cannot increase leverage on the position while it is being liquidated.
  • Once the position exits liquidation and the warning disappears, wait at least one minute before submitting new orders for that position.
  • All liquidation orders appear in your orders overview in real time so you can track the process.
Adding margin as soon as you see the liquidation warning is the fastest way to stop the process. On isolated margin, reducing leverage proactively before margin thresholds are reached prevents liquidation from starting at all.

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Liquidation Failure

The system submits a liquidation order only when market depth and estimated fill prices meet its close-out criteria. In conditions of extreme price movement or insufficient liquidity, it may not be possible to close the position through normal liquidation. If liquidation cannot complete, the position may transfer to a Liquidity Provider. See Deleverage Events to understand how Everstrike handles the resulting risk in those scenarios.