To avoid liquidation, an account's assets should be kept as such: (total collateral value - total debt value) > maintenance margin requirement.*100%

Now let's dig into the maintenance margin.

Maintenance Margin Requirement = Total Debt * Maintenance Margin Ratio

The maintenance margin ratio is set based on the liquidation leverage set by HTX's risk management team.

Maintenance margin ratio = 1/(liquidation leverage - 1)

If the liquidation leverage is set at 21x, then the maintenance margin ratio = 1 / (21 -1) = 5%.

Example: If the maintenance margin requirement is 5% and an account's collateral value is 100 USDT and its debt is 90 USDT, will this cause a liquidation?

Maintenance margin requirement*100% = 5% * 90 = 4.5 USDT.

Account equity = collateral value - debt value = 100 - 90 = 10 USDT.

As 10 USDT is higher than 4.725 USDT, a liquidation will not occur.

The leverage of this account is collateral value divided by equity, i.e. 100 / (100-90) = 10x. When the leverage reaches 21x, liquidation would be triggered. Let's assume the collateral value remains unchanged and the debt increases from 90 USDT to 95 USDT, and the leverage would be 100 / (100 - 95) = 20x.

Maintenance margin requirement*100% = 5% * 95= 4.75 USDT.

Account equity = collateral value - debt value = 100 - 95 = 5 USDT.

Therefore this account is very close to the liquidation level.