The number that matters more than your entry
Beginners open a futures position thinking about the target. The exchange is thinking about one number only: the price at which your margin runs out. At 10x leverage that is roughly 10% away. At 50x it is about 2% - well inside the noise of an ordinary afternoon in crypto. Nothing about the trade idea changes; only the room you have to be early.
Isolated or cross, and why it matters
In isolated margin only the margin you posted is at stake, and the liquidation price is fixed the moment you open. In cross margin the entire wallet backs the position, so liquidation sits much further away - until it arrives and takes everything, including the balance you were holding for other trades. Beginners should stay isolated, with a small, deliberate amount of margin per position.
Funding quietly moves the line
Perpetual contracts charge funding every eight hours on most venues. Those payments come out of your margin, which means a long held through several positive funding periods is slowly walking toward its own liquidation price even if the chart has not moved. Price it before you hold overnight with the funding rate calculator.
Where to actually trade this
Liquidation mechanics, maintenance tiers and liquidation fees differ by venue, and so does what happens in a violent wick. We open accounts and check these ourselves rather than repeating the marketing page - see the crypto exchange reviews, or answer five questions in the Broker Matcher.
How far the line sits, by leverage
Isolated margin, 0.5% maintenance, before funding and fees. These are the distances that matter more than any entry.
| Leverage | Move to liquidation | On BTC at $84,000 | What that is |
|---|---|---|---|
| 3x | 32.8% | $56,448 | A bear market |
| 5x | 19.5% | $67,620 | A bad month |
| 10x | 9.5% | $76,020 | A bad week |
| 20x | 4.5% | $80,220 | A bad day |
| 50x | 1.5% | $82,740 | A bad hour |
| 100x | 0.5% | $83,580 | A single candle |
Nothing in that table is about being right. It is purely about how much room the position has to breathe before the exchange closes it for you.
Maintenance margin rises with position size
The 0.5% default is the first tier. Venues publish tiered tables where the requirement climbs as notional grows, so a $500,000 position may sit at 1% or 2.5% and liquidate meaningfully earlier than a $5,000 one at the same leverage. If you trade size, read your venue's tier table rather than trusting any calculator's default, this one included.
Funding quietly moves the line toward you
Perpetual contracts settle funding every eight hours on most venues. Those payments come out of your margin, so a long held through several positive periods is walking toward its own liquidation price while the chart does nothing. At 0.01% per period the drag is small; at 0.05% it annualises past 50% and becomes the dominant cost of the trade. Price it on the funding rate calculator before holding overnight.
Where the stop belongs
A useful rule: the stop should sit no further than halfway between entry and liquidation. At 20x that means a stop inside about 2.2%, which for most crypto pairs is inside normal noise - a sign the leverage is wrong for the instrument rather than the stop being wrong for the trade. Work the other way instead: decide the stop from the chart, then let position size and the risk percentage choose the leverage for you. Leverage should be an output, not a setting you pick first.
What the estimate leaves out
- Tiered maintenance margin on larger positions, which liquidates you earlier.
- Liquidation fees, charged by most venues on top of the loss.
- Funding, which erodes margin on every settlement while the position is open.
- Mark price versus last price. Most venues liquidate against a mark price derived from an index, not the last trade on their own book, which is what stops a single wick from liquidating everyone - usually.
Rehearse it before risking money
The Practice Arena runs a $10,000 paper account on live prices with the same arithmetic, and will not let you open a position without a stop. It is the cheapest way to find out how a 20x position feels when it moves 2% against you.
Frequently asked
How is the liquidation price calculated?
For an isolated-margin long: liquidation price = entry × (1 − 1/leverage + maintenance margin rate). For a short: entry × (1 + 1/leverage − maintenance margin rate). In plain terms the position closes when the loss has eaten your margin down to the maintenance requirement, so higher leverage pulls that price closer to your entry.
How far is liquidation at 10x, 20x and 50x?
With a 0.5% maintenance margin in isolated mode, roughly 9.5% away at 10x, 4.5% at 20x, 2.0% at 50x and 0.5% at 100x. In crypto a 2% move is an ordinary afternoon, which is why high-leverage positions are usually ended by noise rather than by being wrong about direction.
What is maintenance margin?
The minimum equity the exchange requires you to keep against an open position, quoted as a percentage of position value. The first tier is commonly around 0.5% and it rises as the position gets larger, so a big position is liquidated earlier than this estimate suggests. Each venue publishes its own tier table.
Does my liquidation price change after I open the trade?
In isolated margin it stays put unless you add margin, which pushes it further away. In cross margin it moves constantly because every other position and your whole wallet feed the same pool. Funding payments also reduce your margin on perpetuals, which drags liquidation nearer over time even if price has not moved.
Is cross margin safer than isolated?
It moves liquidation further away and makes losing everything more likely, which are not the same thing. Cross lends the position your entire balance, so one bad trade can take the money that was funding every other position. Isolated caps the damage at the margin you posted, which is what makes a mistake survivable while you are learning.
Can I be liquidated at a better or worse price than shown?
Worse, usually. Liquidation is a forced market close in whatever conditions exist, often with a liquidation fee attached, and in a violent wick it can fill well past the stated price. Some venues then use an insurance fund or auto-deleveraging to absorb the rest. Treat the number here as the optimistic case.
Should I use a stop loss instead of relying on liquidation?
Always. Liquidation is the exchange protecting itself at the worst possible moment. A stop is your own exit at a price you chose, placed where the trade idea is proven wrong. A reasonable habit is to keep the stop at most halfway to the liquidation price, so ordinary volatility can never reach the liquidation level first.
Does adding margin remove the risk?
It moves the line, it does not remove it. Adding margin to a losing position increases the money exposed to the same idea that is currently being disproven. If the plan did not say to add, adding is not risk management, it is funding your own liquidation more slowly.
Is this liquidation calculator free?
Yes, with no sign-up. It runs in your browser and the numbers never reach us.
Trading is high risk and most retail accounts lose money. This tool is education only, not financial advice.