Katana Perps — Liquidations
Understand Katana Perps liquidation thresholds, close prices, insurance fund protection, auto-deleveraging and ways to reduce liquidation risk. Read the current
When Liquidation Happens
Liquidation occurs when wallet equity falls below the total maintenance margin requirement. Katana Perps evaluates the account at wallet level because positions share cross-margin.
Insurance Fund & ADL
Liquidation PnL is absorbed by the insurance fund. If the fund cannot absorb the liquidation, the system can use auto-deleveraging (ADL) against opposing profitable positions.
Reducing Liquidation Risk
- Use conservative leverage
- Monitor margin ratio
- Maintain excess free collateral
- Use stop-loss orders
- Manage position size