Derivatives
Liquidation
The forced closing of a leveraged position when losses consume the margin backing it.
A 10x long with $10,000 of margin controls $100,000 of exposure and is liquidated after roughly a 9 to 10 percent adverse move, before the margin hits zero. The exchange closes the position at market, which pushes price further in the same direction and can trigger a cascade.
Liquidation prices are public for on-chain venues such as Hyperliquid, which is why whale pages show them. Clusters of liquidation levels act as magnets in volatile sessions.
The lesson most traders learn expensively: position size, not direction, decides whether you survive a normal move.
📱 Compare how the same event is priced across venues on Polymtrade.Referral link. 18+.
Where you will see it on BetG8
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Frequently asked questions
- What does "Liquidation" mean?
- The forced closing of a leveraged position when losses consume the margin backing it.
- Why does liquidation matter for prediction markets?
- The lesson most traders learn expensively: position size, not direction, decides whether you survive a normal move.