Margin & Leverage

Isolated margin

Levant uses isolated margin. The collateral you post for a position — denominated in USDG — is dedicated to that position alone and caps its maximum loss. Positions never share collateral: a loss on one can never draw down the margin of another, and one position being liquidated leaves your others untouched. Each position carries its own entry price, integer leverage, funding basis, reserved liquidity, and liquidation price.

• Collateral is posted per position in USDG, between a minimum of 10 USDG and a maximum of 500,000 USDG.
• Your maximum loss is bounded by that position's margin — you can never lose more than you put in.
• Positions are fully independent: no cross-margining and no shared risk.
• The counterparty is always the Levant Vault, so there is no other trader whose default could affect your isolated collateral.

From deposit to position size

Leverage is an integer multiplier — 2x, 3x, and so on, from a minimum of 1x up to the market maximum of 100x. There is no fractional leverage. When you open, the amount you deposit is escrowed on-chain by the Diamond, the open fee is deducted from it to give your net margin, and net margin is then multiplied by leverage to give your position size, called notional.

open fee   = 0.08% × (deposit × leverage)   // 8 bps on GROSS notional
net margin = deposit − open fee             // your isolated collateral
notional   = net margin × leverage          // position size, stored on-chain

The open fee is charged on the gross notional (your full deposit × leverage), then removed from your deposit before the position is sized. Example: deposit 100 USDG at 10x. The open fee is 0.08% × 1,000 = 0.8 USDG, leaving a net margin of 99.2 USDG and a notional of 99.2 × 10 = 992 USDG. From there a 1% price move is a 9.92 USDG swing — about 10% of your margin — in either direction. Because PnL, funding, and fees all scale with notional rather than margin, leverage amplifies gains and losses symmetrically. The close fee, likewise 0.08%, is charged at close on the *adjusted size* (notional ± realized PnL).

Collateral limits

Every position's collateral is bounded on both ends. The limits are checked when you open (against your deposit) and re-checked whenever you change margin on a live position.

Notional is stored, not recomputed

At open, Levant computes notional once — net margin × leverage — and stores it explicitly on the position. From that point on, the stored notional (not collateral × leverage) is the single source of truth for PnL, funding, open interest, and fees. This is what lets you change margin on a live position without disturbing its size.

A consequence: once you add margin, remove margin, or partially close, the identity notional = collateral × leverage no longer holds. The integer leverage shown on your position becomes a display label from when you opened; your real leverage is always notional divided by current margin.

Effective leverage

Notional is fixed at open, but your margin balance moves over time — funding accrues, unrealized PnL swings, and you can deposit or withdraw collateral. Effective leverage is your live notional divided by your current margin. It is what actually determines how close you are to liquidation.

effective leverage = notional ÷ current margin

• Add margin → the denominator grows → effective leverage falls and liquidation moves further away.
• Remove margin → the denominator shrinks → effective leverage rises and liquidation moves closer.
• Losses or funding quietly shrink your margin, so effective leverage drifts *up* even if you do nothing.
• Unrealized profit grows your margin, so effective leverage drifts *down* as a winning trade runs.

Liquidation distance and the max-profit cap

Two thresholds bracket every position, and both are functions of effective leverage. On the downside, a position becomes liquidatable once its equity falls to the maintenance margin of 10% of collateral — roughly a 90% loss including funding. On the upside, profit is capped at 900% of margin: when you open, the vault locks reserved = margin × 9 so it can always fund your best case, and PnL beyond that ceiling is simply not paid.

maintenance margin = 10% of collateral   → liquidation at a ~90% loss
max profit         = 900% of margin      → reserved = margin × 9

adverse move to liquidation  ≈  90% ÷ effective leverage
favorable move to max profit ≈ 900% ÷ effective leverage

These figures are measured from your entry price and ignore the entry/exit spread, the open and close fees, and funding — all of which erode equity and pull the liquidation point slightly closer while making the max-profit ceiling slightly harder to reach. Note the symmetry: at 100x a ~0.9% move against you liquidates the position, and a ~9% move in your favor already hits the profit cap, after which further price movement earns you nothing.

Adding margin

Adding margin deposits more USDG into an open position. Notional stays exactly the same, so your effective leverage falls and your liquidation price moves further away from the mark. This can only reduce risk, so it needs no oracle price and settles immediately.

• Notional is unchanged; only your margin — the denominator of effective leverage — grows.
• No price report is required: adding collateral can never move you toward liquidation.
• The new collateral total must still respect the 500,000 USDG maximum.
• Use it to de-risk a position you want to hold through volatility instead of closing and reopening it.
• Your reserved max-profit ceiling is locked at open (9× your opening net margin) and does not rise when you add margin — adding collateral lowers effective leverage and pushes liquidation away, but it does not buy you a larger capped payout.

Removing margin

Removing margin withdraws USDG from an open position while keeping it open. Notional stays the same, so your effective leverage rises and your liquidation price moves closer to the mark. Because this increases risk, the withdrawal is checked against a fresh signed oracle price and is rejected if it would breach any safety limit.

• The remaining collateral must stay at or above the 10 USDG minimum.
• Effective leverage after the withdrawal — notional ÷ remaining margin — must stay within the market's 100x maximum.
• The position must remain strictly above its maintenance margin at the current price, including accrued funding — you can never withdraw margin into a liquidation.

Partial close

A partial close settles a percentage of your position — for example 25%, 50%, or 75% — and leaves the rest open. It scales collateral, notional, and reserved liquidity by the same fraction, so effective leverage is unchanged while your absolute size and risk shrink. The remainder keeps its original entry price and funding basis.

• Realizes proportional PnL and charges the 0.08% close fee on the portion you close.
• Releases the corresponding share of the position's reserved max-profit liquidity back to the vault.
• The remaining position keeps its entry price and funding basis — only its size shrinks.
• The remainder must itself stay at or above the 10 USDG minimum collateral; otherwise close the position in full instead.