Leverage & Margin

Leverage is the defining feature — and the defining risk — of perps trading. This page explains how it works mechanically, how margin and liquidation behave, and how to keep yourself out of trouble.

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What Leverage Does

Leverage multiplies your market exposure relative to the collateral you post.

Example: At 10x, $100 of margin controls a $1,000 position.

• The asset rises 10% → your position gains $100 — a 100% return on margin.
• The asset falls 10% → your position loses $100 — your entire margin is gone.

Upside and downside are amplified equally.

Leverage Limits

Maximum leverage is set per market by Hyperliquid — up to 40x on the deepest majors like BTC and ETH, lower on mid-caps, and as low as 3x on newer or thinner markets. The order panel shows the current maximum for the selected market and caps your setting to it.

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Margin

Margin is the USDC collateral that backs your leveraged position.

Initial Margin

The collateral required to open a position:

Initial margin = position size ÷ leverage

Higher leverage reduces the initial margin needed but increases liquidation risk.

Maintenance Margin

The minimum margin required to keep the position open — set by Hyperliquid per market, at half the margin required at that market’s maximum leverage. For example, on a 20x-max market the minimum initial margin is 5%, so maintenance margin is 2.5%. If your equity falls below it, liquidation is triggered.

Margin Modes: Isolated vs. Cross

Mode	Collateral pool	Effect of liquidation	Best for
Isolated (default)	Locked to one position only	Cannot touch your other positions or free balance	Ringfenced risk on a specific trade
Cross	Shared across all your cross positions, plus unrealised PnL	A liquidation can affect the entire cross account	Capital efficiency; coordinated positions

You select the mode before opening; changing it requires closing the position in that market first.

Adding or Removing Margin

• Isolated positions — add or remove margin from the Positions panel after opening, which moves the liquidation price further from (or closer to) the current price. Adding is capped by your available balance.
• Cross positions — margin is managed at the account level rather than per position.

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Liquidation

Every leveraged position has a liquidation price, shown before you confirm the order and live on the position afterwards. If the mark price reaches it, the position is closed automatically and the margin backing it is lost.

Mark Price, Not Last Trade

Liquidations trigger on the mark price, which Hyperliquid derives from external exchange prices and the order book. This protects against being liquidated by a single thin print or a brief wick — though in high volatility the mark can still differ noticeably from the last trade.

How Liquidation Runs

Liquidation is handled by Hyperliquid’s protocol: the position is sent to the order book to close, with large positions unwound in stages, and a backstop liquidator takes over if the book can’t absorb it. There is no separate clearance fee — the cost of liquidation is the loss of the margin backing the position.

Leverage vs. Liquidation Distance (long, simplified)

Entry	Leverage	Approx. liquidation price
$100	2x	~$51
$100	5x	~$81
$100	10x	~$91
$100	20x	~$96
$100	40x	~$98

Exact liquidation price depends on the market’s maintenance margin and accrued funding — the live value is always shown on your position.

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Reducing Liquidation Risk

1. Use lower leverage. The single most effective control. 2–5x leaves real room to breathe.
2. Add margin to an isolated position. Lowers effective leverage and pushes the liquidation price away from market.
3. Set a stop-loss before your liquidation price. Triggers off the mark price, exits on your terms, and preserves capital. See How to Close a Position.
4. Watch funding. Funding settles hourly (see Fees → Funding). Sustained adverse funding eats into margin and brings the liquidation price closer over time.

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Note

Your liquidation price is live — it reacts to mark price, accrued funding, and margin changes. Check it before walking away from a position, especially in volatile markets.