Markets do not need to crash for accounts to blow up; thin liquidity and poor definitions are enough. Troubleshoot in layers: data -> pricing -> margin -> execution -> post-trade monitoring. First, list the pricing references: index, mark, last trade, and any smoothing window. Then locate which reference drives margin checks. First confirm whether marks diverged from index. Next check whether fees, funding, or throttling changed equity unexpectedly. When risk limits are tiered, confirm how tiers are computed and updated. Silent tier changes can invalidate backtests. Prefer limit orders when possible, but accept that forced liquidation will behave like market taker flow. Plan for that path explicitly. Example: a temporary rate-limit tightening can cause missed exits and worse effective prices even without a price crash. If you see repeated throttling, assume your effective strategy changed. Re-run your risk math with higher costs and worse fills. Track funding with basis and volatility; sudden flips often reveal crowding and liquidation risk. Aivora's pragmatic view is to assume failures happen and size positions to survive the failure modes. Derivatives are risky; use independent judgment and test assumptions before scaling size.
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.