Margin Requirements

Pure parameter reference for margin thresholds. For conceptual explanation of the margin model, see Margin Model.

Margin Parameters

Parameter	Config Key	Default	Unit	Onchain
Initial Margin Factor	`imFactorBps`	200 bps (2%)	Basis points	Stored in Config
Maintenance Margin Factor	`mmFactorBps`	100 bps (1%)	Basis points	Stored in Config
BPS Denominator	`BPS_DENOMINATOR`	10,000	Constant	Hardcoded

Formulas

minIM = notional × imFactorBps / BPS_DENOMINATOR
mmThreshold = notional × mmFactorBps / BPS_DENOMINATOR
equity = lockedMargin + unrealizedPnL
liquidatable = equity < mmThreshold

Invariant

imFactorBps > mmFactorBps    (enforced by Config.setMarginConfig())

Any attempt to set mmFactorBps >= imFactorBps reverts.

Leverage Tiers

Margin %	Margin (bps)	Leverage	Buffer to Liquidation	Example: 10,000 USDC Notional
2%	200	50x	~1% adverse move	200 USDC margin, 100 USDC MM
5%	500	20x	~4% adverse move	500 USDC margin, 100 USDC MM
10%	1,000	10x	~9% adverse move	1,000 USDC margin, 100 USDC MM
20%	2,000	5x	~19% adverse move	2,000 USDC margin, 100 USDC MM
50%	5,000	2x	~49% adverse move	5,000 USDC margin, 100 USDC MM
100%	10,000	1x	Cannot be liquidated	10,000 USDC margin, 100 USDC MM

Margin Operation Constraints

Operation	Condition	Description
Open position	`margin >= minIM`	Must meet minimum initial margin
Open position	`margin <= notional`	Cannot exceed notional
Add margin	`lockedMargin + amount <= notional`	Total cannot exceed notional
Add margin	Always allowed	Works even when liquidatable (rescue)
Remove margin	`remaining >= minIM`	Must maintain minimum IM
Remove margin	`equity after > mmThreshold`	Must not become liquidatable
Remove margin	Position not liquidatable	Cannot remove from underwater position

Liquidation Condition

positionEquity < mmThreshold

Strict less-than (<). A position with equity exactly equal to MM is not liquidatable.

Snapshotted Fields

These values are captured at position open time and never change for that position:

Field	Source	Description
`snapshotImBps`	Config	IM factor when position was opened
`snapshotMmBps`	Config	MM factor when position was opened
`snapshotTradingFeeBps`	Config	Trading fee when position was opened
`snapshotLiquidationPenaltyBps`	Config	Liquidation penalty when position was opened
`snapshotOracleFee`	Config	Oracle fee when position was opened

Admin changes to these parameters only affect positions opened after the change.

Margin Model

Conceptual explanation of isolated margin, leverage, and equity.

Liquidation

Liquidation mechanics, penalty calculation, and keeper incentives.

Parameter Reference

Complete list of all configurable protocol parameters.

Overview

FX Forwards

Roadmap

Margin Parameters

Formulas

Invariant

Leverage Tiers

Margin Operation Constraints

Liquidation Condition

Snapshotted Fields

Margin Model

Liquidation

Parameter Reference

​Margin Parameters

​Formulas

​Invariant

​Leverage Tiers

​Margin Operation Constraints

​Liquidation Condition

​Snapshotted Fields

​Related Pages

Margin Model

Liquidation

Parameter Reference

Margin Parameters

Formulas

Invariant

Leverage Tiers

Margin Operation Constraints

Liquidation Condition

Snapshotted Fields

Related Pages