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DeFi & governance

Collateral liquidation

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

Reference note · Sources below

Research articles and reference entries are published in English. Navigation is available in seven languages.

In this article
  1. Overview
  2. Why it matters
  3. What to check
  4. Sources

Overview

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

Why it matters

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

What to check

Rebuild account health at the liquidation block.

Sources

Related reading

defi

Leverage and liquidation

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

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