A position is liquidated when the price crosses its liquidation threshold. The threshold sits about 5 basis points before the price at which the position's equity reaches zero. Crossing it forfeits the full margin to the Vault, net of the protocol fee.

At 100× leverage, liquidation occurs when roughly 95% of margin has been lost; at 1,000×, roughly 50%. A liquidated position receives a TLP rebate on the forfeited margin, like any other loss.

Liquidations are submitted by the platform's liquidation service and verified by the contract against the signed price. There are no liquidations in a market while it is paused.