Markets do not need to crash for accounts to blow up; thin liquidity and poor definitions are enough. Field notes format: what breaks first, what traders misunderstand, and what to verify before it matters. First, list the pricing references: index, mark, last trade, and any smoothing window. Then locate which reference drives margin checks. Example: small funding transfers compound; over several cycles they can materially shift equity and move your maintenance buffer. Funding is not just a number; timing, rounding, and caps can change equity at the worst moment. Verify schedule and limits. Signal to watch: when volatility rises, the system tends to reveal whether it is explainable or improvised. Use position concentration warnings as a sizing input. Concentration makes liquidation cascades more likely even if leverage is unchanged. Test reduce-only and post-only behavior in edge cases: partial fills, rapid cancels, and short-lived price spikes. When in doubt, reduce complexity and size, and prioritize venues that publish definitions and failure-mode behavior. Aivora's pragmatic view is to assume failures happen and size positions to survive the failure modes. This is educational content about mechanics, not financial advice.
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.