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Binance Margin provides users with the flexibility to choose different leverage multipliers based on their risk tolerance and trading strategies. Depending on the Margin product, leverage can range from 3x up to a maximum of 10x.
How are liquidations triggered on Binance Margin?
When the liquidation threshold is reached, a user’s margin position will be liquidated, and their collateral will be sold to repay any liabilities and interest owed.Each margin mode and leverage multipliers has different liquidation margin levels:
There are two types of forced liquidation: regular liquidation and takeover liquidation. The system determines the liquidation method based on the market liquidity of the traded assets.
Regular liquidation
Takes place within the user's margin account.
Collateral assets are sold to offset liabilities and accumulated interest.
During the liquidation process, the account is locked, preventing the user from transferring funds, borrowing or repaying assets, and trading.
Takeover liquidation
Occurs when the traded assets lack sufficient liquidity during the given period.
Upon triggering a takeover liquidation, all collateral assets and liabilities in the user's margin account are transferred to the Binance liquidation account.
The liquidation engine consolidates and sells the collateral assets and manages the liability and interest repayments.
During periods of high market volatility, takeover liquidation cases may take longer to complete due to multiple users’ collateral assets waiting to be sold.
Regular Liquidation
Takeover Liquidation
Visibility of Liquidation Orders
Yes
No
Visibility of Position Snapshots
Yes
No
Locked Account
Yes
No
Liquidation Fees
Yes
Yes
Selling of Collateral and Repayment of Debt
Complete in the user’s Margin Account
Complete in the Binance Liquidation Account
During extreme market volatility or when the collateral ratio of a user's assets is low, both regular liquidation and takeover liquidation may occur. The liquidation engine will partially trade the collateral assets to repay some liabilities. If market liquidity worsens during this process, it transitions into a takeover liquidation. This transition helps minimize the impact on the market price volatility.
Examples
Scenario 1
User A has a net equity of 2 BTC and a 400,000 USDC loan in their Cross Margin account. They buy 8 BTC at 50,000 USDC, with the Margin Level (ML) at 1.25. When BTC price drops to 44,000 USDC, ML drops to 1.1 and triggers a forced liquidation. 9.09090909 BTC is sold and returns the 400,000 USDC liability (assuming no interest) and pays a liquidation fee of 0.18181818 BTC (equivalent 8,000 USDC value). After the liquidation, User A has 0.72727273 BTC remaining in their Cross Margin account.
Period
Collateral
Collateral Value (USDC)
Debt (USDC)
Margin Level
Net Equity Value (USDC)
BTC Price (USDC)
#1 Initial
2 BTC
100,000
0
999
100,000
50,000
#2 Position
10 BTC
500,000
400,000
1.25
100,000
50,000
#3 Liquidation
440,000 USDC
440,000
400,000
1.1
40,000
44,000
#4 Repay
0.90909091 BTC
40,000
0
999
40,000
-
#5 End(Liquidation Fee Deduction)
0.72727273 BTC
32,000
0
999
32,000
-
User A can see the liquidation history and liquidation orders here.
Scenario 2
User B has a net equity of 100,000 SUPER (assuming no collateral haircuts) and a 400,000 USDC loan in their Cross Margin account. They buy SUPER at 1 USDC, with the ML at 1.25. When SUPER price falls to 0.88 USDC, the ML falls to 1.1 and triggers a forced liquidation.
Instead of immediately selling 500,000 SUPER, the liquidation engine determines SUPER to have poor liquidity and triggers a takeover liquidation to prevent introducing further volatility for SUPER. All collateral assets (500,000 SUPER) and liabilities (400,000 USDC) will be transferred from User B’s account to a unified takeover account, and SUPER will be gradually sold based on market liquidity to repay the USDC liabilities. Assuming an average SUPER trading price of 0.87 USDC in the unified takeover account, the remaining 27,000 USDC will be returned to User B’s Cross Margin account after repaying a 400,000 USDC debt and deducting a 8,000 USDC liquidation fee.
Period
Collateral
Collateral Value (USDC)
Debt (USDC)
Margin Level
Net Equity Value (USDC)
SUPER Price (USDC)
#1 Initial
100,000 SUPER
100,000
0
999
100,000
1
#2 Position
500,000 SUPER
500,000
400,000
1.25
100,000
1
#3 Liquidation
500,000 SUPER
440,000
400,000
1.1
40,000
0.88
#4 Takeover
435,000 USDC
435,000
400,000
1.0875
35,000
0.87
#5 Repay
35,000 USDC
35,000
0
999
35,000
-
#6 Return
27,000 USDC
27,000
0
999
27,000
-
User B can see the liquidation history and takeover detail information here.
Scenario 3
User C has a net equity of 1 BTC and 50,000 SUPER (assuming no collateral haircuts), and a 400,000 USDC loan in their Cross Margin account. They buy SUPER at 1 USDC, with the ML at 1.25 (assuming BTC price is 50,000 USDC and remains unchanged).
When SUPER falls to 0.866666667 USDC, the ML falls to 1.1 and triggers a forced liquidation. The liquidation engine sells 1 BTC for 50,000 USDC. Instead of immediately selling 500,000 SUPER, it determines SUPER to have poor liquidity and opts for a takeover liquidation. All of User C’s collateral assets (450,000 SUPER and 50,000 USDC) and liabilities (400,000 USDC) are transferred to a unified takeover account. Assuming an average SUPER trading price of 0.86 USDC in the unified takeover account, the remaining 29,000 USDC will be returned to User C's Cross Margin account after repaying a 400,000 USDC debt and deducting a 8,000 USDC liquidation fee.
Period
Collateral
Collateral Value (USDC)
Debt (USDC)
Margin Level
Net Equity Value (USDC)
Price (USDC)
#1 Initial
1 BTC and 50,000 SUPER
100,000
0
999
100,000
BTC: 50,000 USDC
SUPER: 1 USDC
#2 Position
1 BTC and 450,000 SUPER
500,000
400,000
1.25
100,000
BTC: 50,000 USDC
SUPER: 1 USDC
#3 Liquidation
1 BTC and 450,000 SUPER
440,000
400,000
1.1
40,000
BTC: 50,000 USDC
SUPER: 0.86666667 USDC
#4 Repay 1
450,000 SUPER
390,000
350,000
1.11428571
40,000
-
#5 Takeover
450,000 SUPER
387,000
350,000
1.10571429
35,000
SUPER: 0.86 USDC
#6 Repay 2
37,000 USDC
37,000
0
999
37,000
-
#7 Return
29,000 USDC
29,000
0
999
29,000
-
User C can see the liquidation history, liquidation orders and takeover detail information here.
What are the liquidation fees?
According to Margin Service Terms of Use, a certain percentage of the liquidation fee will be charged both on regular liquidation and takeover liquidation:
Margin Mode
Rate
Fee Base
Cross Margin Classic Mode
2%
Liquidated Assets
Isolated Margin Mode
2%
Liquidated Assets
Cross Margin
Pro Mode
3%
Liquidated Assets
Based on the rates above, if the total amount of liquidated assets is 400,000 USDC, the liquidation fee will be 8,000 USDC.
The liquidation fee will be deducted from the user's remaining assets.
Important Note:For full terms and conditions of Liquidated Assets, please refer to Margin Service Terms of Use.
How to avoid forced liquidations?
In margin trading, forced liquidations can lead to significant losses. To avoid this, we recommend following risk management strategies:
Ensure collateral is sufficient to maintain positions.
Make necessary risk control adjustments in advance.
2. Take Note of Margin Calls
Pay attention to margin call notifications via emails, app push notifications or in-app messages.
Use these alerts to make timely decisions or adjust strategies to prevent forced liquidations.
Margin Mode
Leverage Multiplier
Margin Call Ratio
Cross Margin Classic Mode
3x
1.3
Cross Margin Classic Mode
5x
1.16
Isolated Margin Mode
3x
1.22
Isolated Margin Mode
5x
1.19
Isolated Margin Mode
10x
1.1
Cross Margin Pro Mode
10x
1.5
3. Use the Auto Top-Up function
Users can also use the Auto Top-Up function to reduce the risk of forced liquidations. After enabling the function, the system will automatically transfer available assets from their Spot Wallet to their Margin Wallet.
Disclaimer: Please note that due to extreme market movements, the margin level might hit the liquidation ratio immediately after touching the margin call ratio. Your positions might get liquidated before Auto Top-up can be performed in this case. You are strongly advised to monitor the margin level closely to avoid losses. Binance shall not be liable for any loss incurred.