DeFi und Governance

Collateral liquidation

A protocol sells or seizes collateral when health crosses a threshold.

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Overview

A protocol sells or seizes collateral when health crosses a threshold.

Oracle, bonus, close factor and ordering determine the result.

Rebuild account health at the liquidation block.

DeFi und Governance

A position can be closed by the system before the trader's long-term view has time to play out.

DeFi und Governance

A risk limit being crossed does not ensure collateral can be sold at the reference price.

Krypto-Geschichte

New Zealand exchange Cryptopia suffered a 2019 security breach and later entered liquidation.

Marktstruktur

Favoured liquidators capture discounts before open competition.