1. Liquidation Prewarning
Asset changes in all margin accounts are tracked in real-time by HTX so that risk ratios and liquidation triggers are monitored closely. When a margin account's risk ratio reaches 120%, a pre-warning will be triggered, and a specific SMS and email alert will be sent to the user.
2. Liquidation of Margin Account
When a margin account's risk ratio reaches 110%, liquidation is triggered, and the user is notified of the liquidation via their registered contact information.
3. Entrusted Orders of Liquidated Accounts
When a margin account's risk ratio hits 110%, the system initiates liquidation. Trading is immediately restricted, and all pending orders are canceled. Liquidation orders are then placed to sell assets and repay outstanding debts and interest. Once liquidation is complete, the account returns to a safe risk ratio, and the remaining assets become transferable.
Notes:
(1) How is the price of an entrusted order for a liquidated isolated margin account calculated?
In principle, the price is calculated according to the user's account state when the risk ratio is 100%. The actual order placement may be adjusted based on market conditions.
(2) In the event of negative equity, how is the negative part calculated and repaid?
When negative equity occurs, the account's assets are less than the sum of loan principal and interest, resulting in an outstanding debt: Negative Equity = Loan Principal + Interest - Margin Account Assets.
All assets in the liquidated margin account will be used to repay the loan principal and interest, and the negative equity will be repaid by its subaccounts. Until these debts are paid off, the withdrawal function of the affected cross margin or isolated margin accounts will be restricted.
