Liquidation refers to an event when margin level hits the maintenance margin, and the position has to be closed and you lose all your position margin. It is triggered when the Mark Price hits the Liquidation Price. The minimum maintenance margin rate for perpetual contracts on Bybit is 0.5% for BTC and 1% for ETH, EOS and XRP. Margin requirements will increase or decrease accordingly as risk limit changes.
Liquidation price is calculated based on the trader's selected leverage, maintenance margin and entry price.
Calculation of liquidation price
Isolated Margin Mode：
Buy/Long
Example: Trader A buys long at 8,000 USD while using 50x leverage.
Sell/Short：
Example: Trader B sells short at 8,000 USD while using 50x leverage.
Cross Margin Mode:
Buy/Long：
$$ \text{Quantity} \times（ {{{1 \over \text{Average Entry Price}} - {1 \over \text{Liquidation Price} }}}） = -（ \text{Account Balance} -\text{Order Margin} - {{{\text{Quantity} \over {\text{Average Entry Price}}}\times\text{Maintenance Margin} }} - {\text{Quantity} \times 0.00075\over\text{Bankruptcy Price}}）$$
Sell/Short：
$$ \text{Quantity} \times（ {{{1 \over \text{Liquidation Price}} - {1 \over \text{Average Entry Price} }}}） = -（ \text{Account Balance} -\text{Order Margin} - {{{\text{Quantity} \over {\text{Average Entry Price}}}\times\text{Maintenance Margin} }} - {\text{Quantity} \times 0.00075\over\text{Bankruptcy Price}}）$$
Example: Trader B has account balance of 0.5BTC and buy long 10000 contracts at 8,000 USD using Cross Margin.Assuming there is no other active orders.
$$ \text{Bankruptcy Price} = {1.00075\times\text{10000}\over{{\text{10000}\over\text{8000}}+ (\text{0.5}-\text{0})}} $$
= 5718.57
$$ \text{10000} \times（ {{{1 \over \text{8000}} - {1 \over \text{Liquidation Price} }}}） = -（ \text{0.5} -\text{0} - {{{\text{10000} \over {\text{8000}}}\times\text{0.5%} }} - {\text{10000} \times 0.00075\over\text{5718.57}}）$$
Liquidation Price = 5739.50
For more details regarding Bankruptcy Price, please click here.
*Note: For long position, the liquidation price will be rounded up to the nearest 0.5 decimal place or integer while for short position, the liquidation price will be rounded down to the nearest 0.5 decimal place or integer.