Skip to main content

Can Maintenance Margin Requirements Change during High Market Stress?

Yes, exchanges reserve the right to dynamically adjust maintenance margin requirements during periods of extreme market volatility or stress. This is a risk control measure to force traders to reduce their leverage or add more collateral.

The goal is to reduce overall systemic risk and prevent a cascade of liquidations that could deplete the insurance fund.

Can the TWAP Time Period Be Dynamically Adjusted Based on Market Conditions?
How Does the Concept of “Volatility Smile” Change during Extreme Market Stress?
Can a Regulatory Body Force a Blockchain Rollback to Resolve a Contract Dispute?
What Role Do Exchanges Play in Preventing Losses from 51% Attacks?