Liquidations

Every position has a bust price, computed once when it opens and stored with it. It is the liquidation trigger, not the point at which the position’s equity is exactly zero. Liquidation is a hard bust: once the price crosses it, the whole margin is forfeited, even though a close just before might still have returned something.

The buffer

The bust price sits a little closer to your entry than the zero-equity price, by a fixed buffer per market: 0.0476% of the price for BTC and 0.0481% for ETH. For a long, it is the entry minus one leverage-th of it, moved up by the buffer; for a short, the mirror image.

Because the buffer is fixed in price, its share of your margin grows with leverage. At low leverage it is a rounding error; at 1000× on BTC the bust price sits about 0.0524% from the entry, and a close at that price would still have returned a large part of the margin, as the last column shows:

Leverage	Bust price	Move to bust	A close there returns
2×	$50,023.8	49.976%	0%
10×	$90,042.8	9.957%	0.4%
50×	$98,046.6	1.953%	2.3%
100×	$99,047.1	0.953%	4.7%
500×	$99,847.5	0.153%	23.8%
1000×	$99,947.5	0.053%	47.5%

Later parameter changes never move the bust price of an open position.

When liquidation fires

A long can be liquidated as soon as the Hyperliquid mid is at or below its bust price; a short, at or above. Liquidation is permissionless: anyone may submit up to 20 positions in one call, and positions not past their bust price are skipped. There is no grace period and no partial liquidation, and the liquidator earns no reward.

The whole margin is lost; that is what a hard bust means. Where it goes:

• The payout queue is empty: a fee of 2% of the margin goes to stakers and the team, the rest to the LP.
• Claims are queued: no fee; the whole margin goes to the side bucket for queued winners.
• Margin funded from your queued balance: the claim it came from is cancelled, with no fee.

In every case you receive TOKEN for the full lost margin.

A close checks the bust price too. If the mid is at or past it when your close executes, the close settles as a liquidation: the whole margin is forfeited, with the liquidation rules above and no builder fee. A close that executes before the price reaches the trigger still returns whatever equity is left.

Who runs the keepers

We do. Our liquidation keeper watches every open position against the live price every block and submits liquidations as soon as positions cross their bust prices, with a priority fee that rises if a liquidation keeps missing blocks. Because liquidation is permissionless, anyone else may run one too.