MUFEX
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English
  • What is MUFEX?
    • πŸ“–Overview
    • 🏦MUFEX's Decentralized and Trustless Approach
    • πŸ“ˆMUFEX Perpetual Trading System
    • πŸ’ŽMUFEX Liquidity Pool
    • πŸ—ΊοΈRoadmap
  • Start Using MUFEX
    • πŸ‘©β€πŸš€Onboarding
    • πŸ’΅Depositing
      • Deposit FAQ
        • What should I do if the deposited currency has not been received?
        • How to solve recharge error?
        • Funds Recovery Guide
    • πŸ“ˆTrading
      • πŸ’ΉOpen/Close Positions
      • πŸ’²Trading Fees
      • πŸ–₯️Market , Limit & Conditional Order
      • πŸ›°οΈTake Profit & Stop Loss
      • 🏝️Isolated Margin/ Cross Margin
      • πŸ“Trading Rules
        • Risk Limit
        • Risk limit Parameters
        • Index Price
        • Mark Price
        • Liquidation Process
        • Margin Mechanism
        • Funding Fee
        • Insurance Fund
        • Auto-Deleveraging (ADL)
      • πŸ“‘Contract Specs
    • πŸ’ŽEarn
    • 🏧Withdrawal
      • Withdrawal FAQs
        • Why Hasn't My Withdrawal Been Credited?
    • πŸ’²Fee Rates
  • Technical Solution
    • πŸ—οΈTechnology Architecture
    • 🏦ZK-Rollup Asset Proof Design
    • πŸ›₯️Dunkirk Asset Recovery
  • What makes MUFEX secure?
    • πŸ“‘MUFEX Security White Paper
      • Security Team and Its Functions
      • Client Security
      • Endpoint Security
      • Network Security
      • Server Security
      • Application Security
      • Smart Contract Security
      • Data Security
      • Physical Infrastructure Security
    • πŸ“”Smart Contracts
    • πŸ”Audit
    • 🐞Bug Bounty
  • Testnet
    • πŸ§‘β€πŸ³Testnet Walkthrough
      • 1️⃣Get started with MUFEX
      • 2️⃣Get Test Tokens
      • 3️⃣Account & Assets
      • 4️⃣Depositing & Withdrawing
      • 5️⃣Trading
      • 6️⃣Earn via MLP
      • 7️⃣Feedback
      • 8️⃣Common Questions
  • Support
    • πŸ””MUFEX Announcement
      • Notice on Upgrade and Adjustment of the Affiliate System
      • MUFEX Upcoming Delisting of Trading Pairs Reminder
      • MUFEX Notice: Delisting of Certain Trading Pairs
      • MUFEX Coin Pair Adjustment Notice
      • MUFEX is Upgrading MLP and Copy Trading Features
      • MUFEX to Discontinue MLP and Copy Trading Services
      • MUFEX Announcement: Notice on Delisting COMPUSDT and GMTUSDT Contracts
      • MUFEX Announcement: System Upgrade and Trading Suspension Notice Postponement
      • System Upgrade and Trading Suspension Notice
      • MUFEX Cryptocurrency Exchange Service Area Statement:
      • Adjusting Parameters for Certain Contract Trading Pairs (2024/2/7)
    • ❓FAQ
      • How to Delete My MUFEX Account?
      • Why is my IP banned from service
      • Can I use MUFEX service if I don't have an web3 wallet
      • Why do I need to deposit first?
      • Why didn't I see the asset balance change after I deposit?
      • Why did I receive an email from Unipass?
      • What is Effective Leverage?
    • πŸ‘©β€πŸ”¬Help Center
    • πŸ“Release Log
    • πŸ‘¨β€πŸ«MUFEX Affiliate Program
    • πŸ’»Social Media & Communities
    • πŸ’ΌBusiness Cooperation
    • πŸ“±Install MUFEX through the App Store
      • How to get an Apple ID in the US
      • How to use Taobao Purchase a non-mainland Apple ID
      • How to install MUFEX iOS TestFlight
    • πŸ™‹β€β™‚οΈEarly Ambassador Program
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  1. Start Using MUFEX
  2. Trading
  3. Trading Rules

Auto-Deleveraging (ADL)

When users are forcibly liquidated, their liquidated positions are taken over by MUFEX's liquidation engine. If the insurance fund is insufficient to compensate for the losses caused by the liquidated positions, the automatic deleveraging system will automatically deleverage investors who hold positions in the opposite direction to the liquidated positions. The order of deleveraging is determined based on the profit percentage and effective leverage, and the deleveraging price is the bankruptcy price of the liquidated positions.

Automatic deleveraging ranking system:

As long as you hold a position, you enter the ranking system. The larger your position, the higher your leverage, and the higher your profit percentage, the higher your ranking in the system. In situations where the market cannot be fully liquidated, you may be prioritized for deleveraging.

Ranking formula:

The priority order of deleveraging is calculated based on profits and leverage, giving priority to traders with higher profits and higher leverage.

ADL Score (Profit List) = Profit Percentage * Effective Leverage (based on position profits)

ADL Score (Loss List) = Profit Percentage / Effective Leverage (based on position losses)

Effective Leverage = Mark Price / (Mark Price - Bankruptcy Price)

Profit Percentage = (Mark Price - Average Opening Price) / Average Opening Price

Note: As the leverage used increases, the bankruptcy price approaches the mark price, resulting in a higher effective leverage calculation. The system ranks long and short positions separately from highest to lowest.

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Last updated 1 year ago

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