Liquidation

Each leverage position on tradable has a strike price, at which the value of the position is equal to 0. In any exchange that supports leverage positions, there is always a price buffer to liquidate the positions before the collateral is depleted, used to protect exchanges from insolvency. Tradable has a buffer value of 80% for liquidation.

If the Oracle price reaches the liquidation price, the position will be liquidated. The liquidation price of a position is calculated using this formula:

The liquidationThreshold is set to 80% as default. The remaining margin of the liquidated position is shared as a reward among liquidators and the Tradable treasury.