Liquidation: If the margin for a given position falls below the required Maintenance Margin, the Qume risk engine takes over that position and attempts to close it in the market. Any margin remaining after closing the position is forfeited to the Qume insurance fund. This is called liquidation.
- Forced liquidation occurs when the Liquidation Price is equal to the Mark Price. Orders generated by the liquidation engine cannot be cancelled or modified.
- After a position is liquidated, leverage value remains unchanged (the system does not modify the existing settings).
Insurance Fund and Auto-Deleveraging:
Qume operates an insurance fund to cover the losses of bankrupt positions. Profits on liquidation orders add to the insurance fund balance.
In the unlikely scenario that the insurance fund is depleted, the exchange's auto-deleveraging system will socialize losses among winning positions.
You can view the daily insurance fund balance on the "Data" page.