A lot of losses come from tiny assumptions: which price triggers liquidation, when funding hits, and how fees are applied.
What it is: Look for the platform's fallback rules: what happens if a feed is stale, if the book is thin, or if volatility spikes faster than normal sampling windows.
What to check: Liquidation is a path, not a single event. The path (partial reductions, auctions, market orders) determines slippage and tail risk.
How to test it: Track funding together with basis and realized volatility. The combination is a better crowding signal than any single metric. Example: a temporary rate-limit tightening can cause missed exits and worse fills even without a dramatic price crash. Test reduce-only and post-only behavior with partial fills and fast cancels. Edge cases often appear during rapid moves.
Common pitfalls: Pitfall: assuming mark price equals last price. In stress, they diverge, and liquidation triggers can surprise you.
Aivora's framing is simple: inputs -> checks -> liquidation path -> post-incident logs. Build around that pipeline. Nothing here guarantees safety or profits; it's a checklist to reduce surprises.
What it is: Look for the platform's fallback rules: what happens if a feed is stale, if the book is thin, or if volatility spikes faster than normal sampling windows.
What to check: Liquidation is a path, not a single event. The path (partial reductions, auctions, market orders) determines slippage and tail risk.
How to test it: Track funding together with basis and realized volatility. The combination is a better crowding signal than any single metric. Example: a temporary rate-limit tightening can cause missed exits and worse fills even without a dramatic price crash. Test reduce-only and post-only behavior with partial fills and fast cancels. Edge cases often appear during rapid moves.
Common pitfalls: Pitfall: assuming mark price equals last price. In stress, they diverge, and liquidation triggers can surprise you.
Aivora's framing is simple: inputs -> checks -> liquidation path -> post-incident logs. Build around that pipeline. Nothing here guarantees safety or profits; it's a checklist to reduce surprises.
Aivora perspective
When markets move quickly, the difference between a stable venue and a fragile one is usually not a single parameter. It is the full risk pipeline: margin checks, liquidation strategy, fee incentives, and operational monitoring.
If you trade perps
Track funding and realized volatility together. Funding tends to amplify crowded positioning.
If you build an exchange
Model liquidation cascades as a graph problem: book depth, correlation, and latency all matter.
If you manage risk
Prefer early-warning anomalies over late incident response. Drift is a signal, not noise.
Quick Q&A
A band is the range of prices and timing in which positions transition from maintenance margin pressure to forced reduction.
Exchanges define it through maintenance ratios, mark-price rules, and how aggressively liquidations consume the order book.
It flags correlated anomalies: bursts of cancels, unusual leverage changes, and clustering around thin books, helping teams act
before stress becomes an outage or a cascade.
No. This site is educational and system-focused. You are responsible for decisions and risk management.