# Liquidations

Source: https://docs.testnet.mog.xyz/trading/liquidations/

Markdown: https://docs.testnet.mog.xyz/trading/liquidations.md

Reviewed protocol version: 11.0.0

Protocol review date: 2026-10-30

Scope: reviewed public documentation. Numerical examples use illustrative or launch settings; they are not live quotes or a guarantee of current deployed parameters. Consult the app for current market and position values.

Liquidation closes your position when the oracle price reaches its liquidation price. You lose the margin committed to that position, including any added margin that has activated.

## More leverage, less room

Higher leverage brings liquidation closer to your entry price. Longs liquidate below entry; shorts liquidate above it.

Each market sets a **liquidation buffer**, 0.02% of price at launch. The liquidation price sits that much closer to entry than the point where your margin runs out. The buffer is the same price distance at every leverage, so it takes a larger share of a high-leverage position's room: about 2% of it at 100× and 20% at 1,000×.

While available treasury equity is below the 5 million USDG [threshold](https://docs.testnet.mog.xyz/mog/buybacks-and-burns/), a new fill takes the market's buffer times a global buffer multiplier. The multiplier is 2× at launch, so a fill at launch takes a 0.04% buffer: about 4% of the room at 100× and 40% at 1,000×. Governance can set it from 1× to 10× after the timelock delay. At or above the threshold, a fill takes the market's buffer alone.

Higher leverage, nearer liquidation

Initial liquidation distance falls from 0.96 percent at 100 times leverage to 0.06 percent at 1,000 times leverage. The dashed line shows the distance without the buffer.

Illustrative entry liquidation distance: `distance (%) = 100 / leverage − b`, with b the buffer a fill takes at launch: the market's 0.02% times the 2× multiplier below the threshold, 0.04%. The loss at liquidation is still the whole margin. This is the initial distance before price rounding, not a current position liquidation calculation after margin changes.

| Entry leverage | Distance from entry |
| -------------- | ------------------- |
| 1×             | 99.96%              |
| 50×            | 1.96%               |
| 100×           | 0.96%               |
| 500×           | 0.16%               |
| 1000×          | 0.06%               |

Entry distances at the launch buffer times the launch multiplier, before price rounding. Follow the liquidation price shown on your position.

[Adding margin](https://docs.testnet.mog.xyz/trading/adding-margin/) moves liquidation farther away once the addition activates. The buffer stays the one set when the position filled.

## A touch is enough

Mog checks the price path recorded by the oracle. A touch of your liquidation price closes the position, even if the price later recovers. That touch takes priority over a pending close or margin addition.

A liquidation earns [MOG](https://docs.testnet.mog.xyz/mog/earning-mog/#your-trading-edge) on the buffer you give up and on your open fee.