Why are liquidations based on the mark price?
Stop-loss orders can be set to trigger based on either the latest price or the mark price. The two settings behave differently during sudden price spikes.
The reason liquidations aren’t calculated using the latest price is to prevent short-lived price distortions in a market from triggering a chain of unjustified liquidations.
Asset in the example: $BTC . Current price: 83011.72 (24h +0.25%).
Leverage isn’t for everyone. If you don’t understand it yet, spot trading is a safer choice.
#BTC
Stop-loss orders can be set to trigger based on either the latest price or the mark price. The two settings behave differently during sudden price spikes.
The reason liquidations aren’t calculated using the latest price is to prevent short-lived price distortions in a market from triggering a chain of unjustified liquidations.
Asset in the example: $BTC . Current price: 83011.72 (24h +0.25%).
Leverage isn’t for everyone. If you don’t understand it yet, spot trading is a safer choice.
#BTC