Effective immediately, forced liquidation will also close out live orders and loan bids as explained below. This is in addition to the mechanism already in place.
Forced liquidation occurs when margin coverage breaches 100% of used margin. Upon initiating forced liquidation, the following will take place:
1. Cancel live Limit orders (both Spot and Margin), one by one, with priority as follows:
Buy orders, then sell orders.
If there are many buy orders, orders with the lowest price will be cancelled first.
If there are many sell orders, orders with the highest price first will be cancelled first.
An email will be sent to notify the user about any order cancelling. Other types of order (Market, Stop, Trailing Stop) will not be canceled.
2. After cancelling all live orders:
If margin coverage is still less than 100%, the system will cancel live loan bids, one by one, until margin coverage reaches the threshold.
The system will cancel loan bids with the highest rate first.
An email will be sent to notify the user.
3. If margin coverage is still less than 100% after closing ALL live orders and ALL live loan bids, the position will be closed and an email will be sent to notify the user about the forced liquidation.