Leverage changes distance to failure
Maximum leverage is asset-dependent. Hyperliquid’s maintenance margin is half the initial margin at maximum leverage, ranging from 1.25% for 40× products to 16.7% for 3× products under the documented schedule.
Using less than maximum leverage increases distance to liquidation, but cross-margin exposure and other positions still matter. Size from a tolerable loss, not the interface maximum.
Mark price drives liquidation
Hyperliquid uses a robust mark derived from several price inputs. This reduces sensitivity to one local print, but it means your liquidation state can differ from what a last-trade chart suggests.
Monitor mark, oracle and account equity. A stop order is a risk instruction; it can slip or fail in a gap and should not be placed at the liquidation boundary.
What happens during liquidation
The system first sends liquidation orders to the book. If equity falls below two thirds of maintenance margin, the backstop mechanism can assume the position. Hyperliquid documents no separate liquidation clearance fee.
Positions above $100,000 can enter partial liquidation in 20% increments with a cooldown before further action. Partial liquidation does not guarantee a favorable outcome; it reduces exposure while the account is under stress.
Controls that matter before entry
Liquidation formulas are deterministic, but realized outcomes depend on the order book and the rest of the account. Use the official interface for current liquidation estimates and recalculate after every size change.
- Keep a buffer above maintenance margin.
- Use an invalidation-based stop well before liquidation.
- Include funding and close fees in available equity.
- Stress the mark price beyond normal volatility.
- Avoid correlated positions that consume margin together.