As the perps function facilitates trading with leverage, the protocol must provide for liquidation of positions which fail to maintain the minimum margin requirements. Traders must be aware that if the market moves against them to the point where the liquidation price is hit, they will lose their margin held in the Vault.
Failure to liquidate losing positions presents a significant risk to the operation of a market or vAMM as this would result in an insufficiently collateralised and unstable market which could cease to function altogether in the event of large price movements. This is why the Audaces protocol was designed to optimize liquidation speed.
In order to efficiently liquidate positions, the protocol proposes an alternative to the naive design which iterates over all known accounts in order to find candidates for liquidation and then individually liquidates all those positions in almost as many transactions. Instead, the Audaces protocol performs liquidation operations across the whole market in one instruction. Because liquidations happen in batches, it's impossible to keep a precise record of the timing of all individual liquidations.
If your position has been liquidated and the index price (i.e. the price stated by the relevant oracle) is still below your liquidation price, the position will appear on the UI as in the figure below.
If your position got liquidated and that the index price is still below your liquidation price the position will appear on the UI like the picture below
You will have to garbage collect the position from the position tree by clicking on Clear or wait to be garbage collected by crankers.
However, if the index price went back above (or below for shorts) the liquidation price of your position, the position will still appear on the UI even if it has been liquidated.
To prevent unnecessary liquidations and market manipulation, liquidations are based on the index price as supplied by the relevant oracle.
The minimum margin requirement is 5%, which means that positions that exceed 20x leverage will be liquidated
The cranker who liquidated the position gets 10% of the collateral and the rest is sent to the insurance fund
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