Margin Trading

Debt Ratio and Liquidation

آخری بار اپ ڈیٹ کیا گیا: ⁦06:06:00 03/03/2026⁩

This article provides a neutral explanation of how the Debt Ratio and liquidation mechanisms function in margin trading on KuCoin EU. It is intended solely to clarify system behaviour and risk controls. It does not constitute investment advice or guidance on trading strategies.

Understanding the Debt Ratio

The Debt Ratio is a system-generated metric that reflects the relationship between a user’s outstanding liabilities and their margin account assets. It is updated in real time so users can monitor their level of market exposure and potential liquidation risk.

You can view the Debt Ratio at any time on the margin account page or the margin trading interface, both on the website and in the app.

 

 

Mode Leverage Multiplier Initial Debt Ratio (Excluding Interest) Alert Threshold Liquidation Threshold Debt Ratio for Outward Transfers
Cross Margin 1-5x 80% 92% 95% ≤ 60%
Isolated Margin 1-10x 90% 92% 95% ≤ 60%

    

 

Important Notes:

  • You may only transfer a portion of your funds out of the margin account if the Debt Ratio is below 60%.
  • To withdraw your entire account balance, check the "Liabilities" section on the margin assets page and ensure you repay all outstanding loans.

  

When Does Liquidation Occur?

Forced liquidation is triggered when changes in the mark price of your holding and debt assets cause your Debt Ratio to reach 95%. At this point, all assets in your margin account are sold to repay debts. Below is a detailed explanation of the process:

1. Triggering Forced Liquidation:

  • When the margin account's Debt Ratio hits the Forced Liquidation threshold (95%), forced liquidation is initiated.

2. During Liquidation:

  • Notifications: The system will notify you via email or station alerts based on your security settings.
  • Restrictions:
    • You will no longer be able to place orders across any margin trading pairs.
    • Any open, unfulfilled orders in your margin account will be canceled automatically.
    • Transferring additional funds into your margin account during liquidation is not allowed.

3. Post-Liquidation Measures:

  • The system will manage the liquidation process to settle debt by closing positions.
  • Any remaining balance after liquidation will be returned to your account in USDC or the liquidated tokens.
  • A risk mitigation fee (different coin assets and liabilities have different liquidation fee rates, please refer to the Liquidation Handling Fees Table) will be deducted to protect against the possibility of negative balances.

4. Abnormal Losses or Negative Balances:

  • If liquidation results in unusual losses or a significant negative balance in your account, the system will temporarily disable the withdrawal function.
  • Withdrawals can be resumed after the system conducts a manual review. If you encounter such an issue, please reach out to our customer support team for further assistance.

 

Additional Notes

1. Mark Price Calculation:

  • Debt Ratio calculations are based on the Mark Price, an estimated fair value of an asset drawn from market-wide prices to prevent abnormal spikes or dips.

2. Isolated Margin Pairs and Liquidation:

    • In isolated margin pairs that do not involve USDC, any remaining balance post-liquidation will be redirected to your Cross Margin account.
    • For example:
      • Trading the ETH/BTC pair? Any residual assets after liquidation are converted and deposited into your account as USDC.
      • Trading pairs involving USDC? Residual amounts will remain in your Isolated Margin account.

     

     

    Risk Warning

    Margin trading involves significant risk and is not appropriate for all users. Leveraged positions expose users to the possibility of losing more than their initial investment. Rapid market fluctuations may result in liquidation of all assets in the margin account.

    Users should:

    • Thoroughly understand margin mechanics,
    • Monitor their Debt Ratio carefully, and
    • Ensure they can bear potential losses.

    Nothing in this article constitutes investment or financial advice. Past performance is not indicative of future outcomes. Users are responsible for all decisions related to margin trading and should act according to their personal risk tolerance and financial capacity.

      

      

    We hope this article has been helpful. Please reach out to our 24/7 customer support via online chat or submit a ticket if you have any other questions.