How is the liquidation price calculated on Gate.io?

Understanding Liquidation Price on Gate.io

The liquidation price on Gate.io is the price at which a trader’s leveraged position is automatically closed by the exchange to prevent further losses. This mechanism protects both the trader and Gate.io from negative equity. When the market moves against a leveraged position and the margin balance drops below the required maintenance margin, the system triggers liquidation. The exact liquidation price depends on several factors including leverage, entry price, position size, and fees.

Gate.io uses a cross-margin system by default for futures trading, meaning all available balance in your futures wallet contributes to maintaining open positions. This affects how the liquidation price is computed because the system considers the total equity, not just isolated margin per trade.

Key Variables in Liquidation Price Calculation

To compute the liquidation price, you must understand these variables:

• Entry Price: The average price at which your position was opened.
• Leverage: The multiplier applied to your position size (e.g., 10x, 20x).
• Position Size: Measured in contracts or USD value.
• Maintenance Margin Rate: A percentage set by Gate.io depending on the leverage used.
• Unrealized P&L: Profit or loss that changes as the market moves.

For a long position, the liquidation price decreases as leverage increases. For a short position, the liquidation price increases with higher leverage. The formula adjusts dynamically based on whether you're long or short.

Step-by-Step Calculation for Long Positions

To calculate the liquidation price manually for a long position on Gate.io:

• Determine your initial margin:Initial Margin = Position Size / Leverage
• Calculate maintenance margin:Maintenance Margin = Position Size × Maintenance Margin Rate
• Estimate liquidation price using this formula:Liquidation Price = Entry Price × (1 - (Initial Margin / Position Size) / (1 - Maintenance Margin Rate))

For example, if you open a $10,000 long position at 10x leverage with an entry price of $50,000 per BTC and a maintenance margin rate of 0.5%:

• Initial Margin = $10,000 / 10 = $1,000
• Maintenance Margin = $10,000 × 0.005 = $50
• Liquidation Price = 50,000 × (1 - (1,000 / 10,000) / (1 - 0.005)) ≈ $45,263

This means if the BTC price falls to around $45,263, your position will be liquidated.

Step-by-Step Calculation for Short Positions

For a short position, the logic flips. The formula becomes:

Liquidation Price = Entry Price × (1 + (Initial Margin / Position Size) / (1 - Maintenance Margin Rate))

Using the same values as above but for a short position:

• Liquidation Price = 50,000 × (1 + (1,000 / 10,000) / (1 - 0.005)) ≈ $55,277

So, if BTC rises to about $55,277, the short position hits liquidation.

These calculations assume no fees or funding costs. In reality, taker fees and funding rates can slightly shift the actual liquidation point, though Gate.io displays real-time liquidation prices in the UI.

How to Check Liquidation Price on Gate.io Interface

Gate.io automatically displays the liquidation price in your open positions tab. Here’s how to locate it:

• Navigate to the Futures Trading section.
• Open the Positions panel.
• Find your active position — the liquidation price appears in the same row as the entry price.
• Hover over the info icon next to “Liquidation Price” for a tooltip explaining the current calculation basis.

This displayed price is updated in real time based on your current equity, unrealized P&L, and the latest mark price used by Gate.io to avoid manipulation. You can also see how close your position is to liquidation via the liquidation risk indicator, which turns red when risk exceeds 80%.

Why Liquidation Prices May Vary Between Users

Even with identical entry prices and leverage, two traders may see different liquidation prices due to:

• Different wallet balances: In cross-margin mode, more available balance delays liquidation.
• Fees and funding payments: Accumulated costs reduce equity slightly.
• Mark price vs. last traded price: Gate.io uses a fair price mark to prevent liquidations based on temporary spikes.
• Position adjustments: Adding or reducing position size mid-trade recalculates the average entry and thus the liquidation level.

This is why relying solely on manual formulas might not match Gate.io’s displayed value exactly — the platform factors in real-time data continuously.

Frequently Asked Questions

Can I change my liquidation price after opening a position?Yes. You can increase your margin manually by transferring more funds into your futures wallet, which lowers the risk and shifts the liquidation price away from the current market. Alternatively, reduce your position size to improve the margin ratio.

Does Gate.io warn me before liquidation?Yes. Gate.io shows a liquidation risk warning when your position’s margin ratio drops below 10%. You’ll also see visual alerts in the trading interface, and email/SMS notifications can be enabled in settings.

What happens if my position gets liquidated?The system closes your position at the prevailing market price. Gate.io uses an auto-deleveraging (ADL) system only in extreme cases where insurance funds are insufficient. Most users experience full closure via the liquidation engine without impacting other traders.

Is the liquidation price the same across all futures pairs on Gate.io?No. Each futures contract has its own maintenance margin rate and funding parameters, so the liquidation price must be calculated separately for BTCUSD, ETHUSD, etc. Always check the specific pair’s rules under “Futures Guide” in Gate.io’s help center.