What Is the Difference between ADL and a Margin Call’s Effect on Liquidity?

A margin call itself has no direct, immediate effect on market liquidity; it is merely a warning to the trader. If the margin call is not met, the resulting liquidation will impact liquidity as the exchange executes a large market order.

Auto-Deleveraging (ADL), however, is a direct, forced closure of a profitable position, which does affect liquidity by reducing the open interest and potentially causing a loss of market confidence.