Futures trading on digital asset platforms involves significant leverage and risk, making it essential for traders to understand how liquidation works. On OKX, one of the world’s leading cryptocurrency exchanges, the liquidation mechanism is designed to protect both users and market stability through a system known as gradual deleveraging. This article explains how to calculate the liquidation price in OKX futures trading, what triggers liquidation, and how different margin modes affect your risk exposure.
Whether you're a beginner or an experienced trader, understanding these mechanics can help you manage risk more effectively and avoid unexpected losses.
Understanding Margin Ratio: The Key to Liquidation
The primary factor that determines whether your position will be liquidated on OKX is the margin ratio. In the unified trading account system, when your margin ratio drops to or below 100%, the system may trigger partial deleveraging or full liquidation.
It's important to note that while you can use the built-in calculator to estimate your liquidation price, having multiple open positions under a unified account may result in discrepancies between the estimated and actual liquidation prices.
👉 Discover how margin ratios impact your trading safety with real-time tools.
1. Single-Currency Margin Mode – Cross Margin
In this mode, all positions in the same currency share the available margin. The formula for calculating the margin ratio is:
Margin Ratio = (Currency Balance + Unrealized PnL – Sell Order Amount – Option Buy Requirements – Isolated Position Requirements – Pending Order Fees) / (Maintenance Margin + Liquidation Fee)
- Maintenance Margin: Sum of maintenance margins across leveraged loans, futures, perpetuals, and options (including pending orders).
- Liquidation Fee: Includes taker fees for leveraged trades, futures/options positions.
This structure ensures that pending orders don’t suddenly push your account into high-risk territory once executed.
Breaking Down Liquidation Fee:
- Leveraged Loan Fee = Position value × taker fee rate
- Futures/Perpetual Fee = Futures position value × taker fee rate
- Option Fee = Option position value × taker fee rate
By factoring in potential fees ahead of time, OKX prevents sudden margin shortfalls due to order execution.
2. Multi-Currency Margin Mode – Cross Margin
Here, collateral from multiple cryptocurrencies contributes to your overall margin pool. The formula simplifies to:
Margin Ratio = Effective Margin / (Maintenance Margin + Deleverage Fee)
Both maintenance margin and deleverage fee are calculated based on:
- Open positions
- Active limit orders (included as potential future obligations)
This approach provides better capital efficiency but requires careful monitoring of each asset’s contribution to your total equity.
3. Isolated Margin – Single or Multi-Currency
Isolated margin separates risk per position. Here's how margin ratio is calculated:
For Long Positions:
Margin Ratio = [Position Value – (Debt + Interest) / Mark Price] / (Maintenance Margin + Fee)
For Short Positions:
Margin Ratio = [Position Value – |Debt + Interest| × Mark Price] / (Maintenance Margin + Fee)
Since isolated positions have dedicated margin, their liquidation depends solely on individual performance rather than the entire portfolio.
How OKX Handles Liquidation: Gradual Deleveraging Explained
Unlike traditional "full liquidation" models, OKX uses a gradual deleveraging mechanism to minimize market impact—especially for large positions.
Here’s how it works:
- When a user’s margin ratio hits ≤100%, the system initiates partial position reduction.
- If after reduction, the new margin ratio still fails to meet the required threshold for its tier, another round of reduction occurs.
- This process continues until either risk is normalized or the entire position is closed.
This tiered approach reduces slippage and avoids sudden price shocks during volatile market conditions.
How to Calculate Your Liquidation Price on OKX
You can manually estimate your liquidation price using the formulas above—but OKX also offers a convenient in-platform calculator.
On Mobile App:
- Go to [Trade] page
- Tap the trading pair (e.g., BTC/USDT)
- Switch mode → Select [Perpetual] → [USDT-Margined] → Choose BTCUSDT Perpetual
- Tap the calculator icon in the top-right corner → [Liquidation Price]
Select:
- Trading pair
- Position mode (Cross/Isolated)
- Side (Long/Short)
- Leverage
- Entry price
- Position size
- Available margin
- Tap [Calculate] to view estimated liquidation price
On Web Platform:
- Click [Trade] in the top-left of OKX homepage
- Navigate to [Futures Trading]
- Scroll down and click the calculator icon at bottom-left
- Choose [Liquidation Price Calculator]
Input:
- Contract type (e.g., BTCUSDT Perpetual)
- Direction (Long/Short)
- Margin mode (Cross/Isolated)
- Leverage level
- Entry price and quantity
- Additional margin (if applicable)
- Click [Calculate] for instant results
These tools provide real-time estimates based on current mark prices and fee structures.
👉 Try calculating your own liquidation risk with advanced trading tools today.
Frequently Asked Questions (FAQ)
Q: What happens when my position gets liquidated?
A: Once your margin ratio falls to or below 100%, OKX initiates gradual deleveraging. It closes portions of your position step-by-step to reduce risk without causing excessive market impact.
Q: Why is my calculated liquidation price different from the actual one?
A: If you hold multiple positions in a unified account, shared margin usage and dynamic funding rates can cause slight deviations between estimated and actual liquidation levels.
Q: Can I avoid liquidation after a partial close?
A: Yes—if after partial deleveraging your remaining position meets the minimum maintenance margin requirement for its tier, further liquidation stops.
Q: Does funding rate affect liquidation price?
A: Indirectly. Funding payments impact unrealized PnL, which affects your effective margin balance and thus alters your margin ratio over time.
Q: Is there a difference between “bankruptcy price” and “liquidation price”?
A: Yes. The liquidation price is when the system starts closing your position; the bankruptcy price is where your loss equals your entire margin. OKX aims to close positions before reaching bankruptcy to recover fees.
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Final Thoughts
Understanding how OKX calculates liquidation prices and manages margin requirements is crucial for any trader using leveraged products. With its unified account system and tiered deleveraging model, OKX balances user protection with market efficiency.
Using the built-in calculators—available on both mobile and web—you can proactively monitor your risk exposure and adjust your strategy accordingly.
👉 Stay ahead of market moves with precise risk analysis tools powered by OKX.