Quick Reference Guide: Understanding Liquidation Levels in Crypto Trading

In the fast-paced world of crypto trading, knowing your liquidation price isn't optional—it's survival. Whether you're trading with leverage on spot or futures, a 30-second grasp of liquidation levels can mean the difference between profit and catastrophic loss.

What happens: When your position's value drops below your maintenance margin requirement, exchanges automatically close your trade. You lose collateral. Game over.

The math is simple but critical. Your liquidation price depends on three factors: entry price, leverage ratio, and margin amount. A 2x long position at $30,000 with standard 5% maintenance margin gets liquidated around $28,500. Miss that number, miss your exit window.

Here's what separates winners from rekt accounts: Track your liquidation level before you even click buy. Set alerts 2-3% above it. Don't assume you have time to react—in volatile markets, the distance between price and liquidation point disappears in seconds.

Bottom line? Check your numbers. Always know your exit. The traders who survive aren't the ones making the biggest bets—they're the ones who understand exactly where the floor is.