Tier	Holdings (BTC)	Maintenance Margin Ratio
1	≤5	0.50%
2	≤10	1.00%
3	≤15	1.50%
4	≤20	2.00%
5	≤25	2.50%
6	≤30	3.00%
7	≤35	3.50%
8	≤40	4.00%
9	≤45	4.50%
10	≤50	5.00%

Margin Modes

BenPay DEX offers two margin modes: Cross-Margin and Isolated Margin.

Cross-Margin: In this mode, all available funds in your account are treated as available margin for your open positions.
Isolated Margin: In this mode, the margin for each position is calculated separately. The profit and loss (P&L) of an isolated position do not affect funds outside of that position's margin.

Initial Margin

Initial Margin = Position's Notional Value / Leverage

The margin required to open a position is calculated as position_size * mark_price / leverage. This initial margin is allocated to the position. For cross-margin positions, the initial margin cannot be withdrawn. For isolated margin positions, you can add more margin after the position is opened.

The unrealized P&L from a cross-margin position is automatically used as available initial margin for new positions. In contrast, the unrealized P&L from an isolated position only serves as additional margin for that specific position. The leverage for an existing position can only be adjusted after the position is fully closed.

Maintenance Margin and Liquidation

Maintenance Margin = (Position's Notional Value * Maintenance Margin Rate) + Initial Margin Amount

Forced Liquidation:

A position will be forced into liquidation when the account value (including unrealized P&L) falls below the total maintenance margin required for the total notional value of all open positions.

Isolated positions are liquidated using the same maintenance margin logic, but the calculation only considers the specific margin allocated to that isolated position and its notional value.

For positions with a negative unrealized P&L, you can take actions to avoid liquidation, such as partially or fully closing the position, adding more margin (for isolated positions), or depositing more collateral (for cross-margin positions).

Leverage Adjustment

BenPay DEX provides a leverage adjustment feature. Users can set their leverage to any integer from 1x up to the maximum allowed leverage. The leverage for an existing position can only be adjusted after the position is fully closed. Leverage is only checked when a position is opened. After that, the user is responsible for monitoring their leverage to avoid liquidation.

Disclaimer

This article is for informational purposes only. This article is not intended to provide (i) investment advice or an investment recommendation; (ii) an offer or solicitation to buy, sell, or hold digital assets; or (iii) financial, accounting, legal, or tax advice. Digital assets, including stablecoins and NFTs, are subject() to high market risk and volatility. You should carefully consider whether trading or holding digital assets is suitable for you in light of your financial condition. Please consult your legal/tax/investment professional for advice on your specific circumstances. You are solely responsible for understanding and complying with all applicable laws and regulations in your jurisdiction.

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