Introduction

This article explains what the Bankruptcy Price is, how it relates to liquidation, and why it matters when trading leveraged positions on Coinlocally Futures.

What is Bankruptcy Price?

The Bankruptcy Price is the price at which your initial margin is completely lost.

When liquidation occurs, your position is closed at this price.

How it works

• If the final liquidation execution price is better than the bankruptcy price, the remaining margin goes to the Insurance Fund.
• If the execution price is worse, the Insurance Fund covers the loss.

Why it matters

• Bankruptcy Price determines the maximum loss for your position.
• It ensures the platform can manage risk and protect other traders.

Additional notes

• Bankruptcy Price is not the same as Liquidation Price.
• Liquidation Price is the trigger; Bankruptcy Price is the execution reference.
• High leverage brings the Bankruptcy Price closer to the entry price.

Common Issues

• Confusing Liquidation Price with Bankruptcy Price.
• Assuming liquidation always happens at the displayed liquidation price.
• Not accounting for market volatility during liquidation.

feeling lost?

If you want help understanding how your Bankruptcy Price was calculated, our support team can walk you through the details.

Updated on: 01/13/2026