When a trader’s position is liquidated, the position is taken over by the FMex liquidation engine. If the liquidation cannot be filled by the time the mark price reaches the bankruptcy price, with no available insurance fund either, the ADL system automatically deleverages opposing traders’ positions by profit and leverage priority.
The price at which a traders’ positions are closed out is the bankruptcy price of the initial liquidated order.
ADL Priority Deleveraging Ranking
At all times, your position in the queue is shown by an indicator. This indicator represents your priority in the queue in 20% increments. If all “lights” are lit, which would mean your position is in the top percentile. In the case of a liquidation that is not able to be caught in the market, you may be deleveraged.
If you are deleveraged, you will be sent a notification. Open orders will be cancelled and you are free to re-enter.