Deribit does not issue a traditional margin call. Margin is checked in real time, 24 hours a day, and there is no grace period in which to deposit funds before positions are reduced. If maintenance margin exceeds the margin balance, liquidation starts immediately.
The emails described on this page are reminders only. Replying to an email, or contacting support, does not add margin and does not pause or stop liquidation.
What “margin call” means on Deribit
Some brokers use variation margin. In that system, a trader whose balance falls below the maintenance margin requirement is asked to top the account back up to the initial margin requirement, often with a deadline. That request is what is usually called a margin call. Deribit does not use variation margin. See What is margin?.
Deribit does send an automated email called Margin call notifications when initial margin goes above 100% of the margin balance. That email is not a deadline, and it is not an instruction to execute the account. Positions are reduced only when maintenance margin goes above 100% of the margin balance.
Initial margin (IM) is the margin required to open a position. Maintenance margin (MM) is the margin required to keep it open. Both are percentages of the account's margin balance. Above 100% means the requirement is larger than the margin balance.
When positions are reduced
An account moves through these stages. Each stage is a different process. Only the maintenance-margin stage, and the stages after it, reduce or transfer derivative positions.
Initial margin above 100%. New orders that would increase margin are rejected, and existing orders that increase margin are cancelled. You can still place orders that reduce margin. Nothing is executed yet.
Maintenance margin above 100%. Incremental liquidation starts at once. Where the market can take the size, the engine sends about one round of liquidation orders per second, and it stops as soon as maintenance margin is back below the margin balance. While this is running you cannot place orders, and you cannot cancel orders created by the liquidation engine.
Close-out margin. This is a tighter threshold than maintenance margin. Eligible positions may be transferred to Liquidity Support Program (LSP) providers, and if that capacity is used up, to other members by auto-deleveraging (ADL). See Liquidity Support Program (LSP).
Bankruptcy. Equity has gone negative after positions have been closed. The insurance fund covers that shortfall so the other side of the trade is still paid. If the insurance fund could not cover it, the remainder would be socialised among winning traders for that session. There has not been a socialised loss on Deribit.
Account rebalancing. This is not one of the stages above. On a cross-collateral account it converts one currency into another. It does not liquidate derivatives. See below.
Emails: when they are sent, and how often
The emails are turned on when an account is activated. You can turn each one off under Email Notifications on the Account settings page. They are sent to the email address of the account that breached. If the positions are on a subaccount, the email goes to that subaccount. A main account can be set to receive copies of critical subaccount emails, including liquidations. See Subaccounts.
Do not use these emails as a risk system. A breach that is cleared in a few seconds may not produce an email at all. Watch margin on the account page, or with the API fields in the last section.
Margin call notifications. Sent when initial margin is above the margin balance, the account has positions, and maintenance margin is not breached. At most once every 24 hours. It is not sent while maintenance margin is already breached; the liquidation email is used instead.
Liquidation notifications. Sent only after liquidation has already been running for 20 seconds, and then at most once every 10 minutes. If maintenance margin is brought back under 100% in less than 20 seconds, no liquidation email is sent for that run.
Close-out email. Uses the same Liquidation notifications setting. Sent when close-out margin is breached and the account has positions that LSP or ADL can act on. At most once every 10 minutes. This can be sent as well as the liquidation email. They are separate messages.
Rebalance notifications. A different setting, and not a margin call. Sent when Deribit places a spot order to rebalance a cross-collateral currency with negative equity. At most once every 10 minutes. If the limit is breached but no rebalancing order is placed, this email is not sent.
What you can do, and what does not help
Before liquidation
This is the window where initial margin is above 100% and maintenance margin is still covered. You still control the account, limited to orders that reduce margin.
The following actions can bring initial margin back under 100%:
Deposit funds into the same account that holds the positions.
Transfer funds in from another subaccount. Funds left on a different subaccount do not count.
Reduce positions with an order that lowers the margin requirement.
The following actions do not help:
Replying to the margin call email.
Contacting support to ask for a pause, a grace period, or a manual exception.
On standard margin, reducing or closing a position lowers that position's margin requirement.
On portfolio margin it is less straightforward. Positions offset each other, so closing one instrument can increase the margin of the portfolio if that instrument was hedging the rest. While initial margin is above 100%, an order is accepted only when it reduces the portfolio's margin requirement. Closing a hedge that increases margin is rejected.
While liquidation is running
Once maintenance margin is above 100%, you cannot place orders, including closing orders, and you cannot cancel the liquidation engine's orders. Position reduction is done by Deribit until maintenance margin is below the margin balance again. See Liquidations.
A deposit, or a transfer in from another subaccount, can still raise the margin balance during liquidation. If that brings maintenance margin back under 100%, liquidation stops and the positions that have not yet been closed stay open. Withdrawing, or moving funds out, does not help.
On portfolio margin, liquidation can open or increase futures positions in order to hedge delta. If maintenance margin then falls back under 100%, those hedges stay open. They are your positions to manage.
Account rebalancing is not a margin call
When cross collateral is enabled, one settlement currency can go negative while the account as a whole still has enough maintenance margin. There is an absolute limit and a relative limit on how negative that currency may become. Once either limit is breached, Deribit buys the negative currency with a currency that has positive equity, using the spot market.
That conversion is account rebalancing. It is a separate process from liquidation. A healthy account can be rebalanced. Derivative positions are not closed, and there is no liquidation fee. The spot markets used for the conversion have zero fees.
The rebalance email is the Rebalance notifications email above. It is not the margin call email, and it does not mean the account is about to be executed.
For as long as equity in that currency stays negative, a collateral fee is charged in the same currency. You can avoid the fee by depositing that currency, or by converting on the spot market yourself. In the transaction log the fee is type Negative equity fee. That entry is not a liquidation.
Rebalancing that happens after a cross-collateral liquidation, to cover a negative settlement currency created by the liquidation, is described under cross-collateral liquidation rebalancing in Liquidations. That step is also a currency conversion. It is not a margin call.
How this differs from liquidation, LSP, ADL, and bankruptcy
Margin call email. Initial margin is above 100%. You can still reduce risk yourself. No positions are executed because of this email.
Liquidation. Maintenance margin is above 100%. Positions are reduced on the order book. Trades pay the extra liquidation fee, which is added to the insurance fund. See Fees.
LSP. Close-out margin is reached and an eligible position is transferred to a support provider, off the public order book. This is a position transfer, not a request to deposit.
ADL. LSP capacity is used up, or the instrument is not covered by LSP, and the position is transferred to members who hold the other side. Those members can have a profitable position reduced. They are not being margin-called.
Bankruptcy and the insurance fund. The account is already negative after positions have been closed. The insurance fund pays the shortfall. The log entry is a transfer from the insurance fund, not a margin call.
Socialised loss. Would apply only if the insurance fund could not cover a bankruptcy. It would adjust that session's winning traders. It is not a margin call to the bankrupt account. It has not occurred on Deribit.
Account rebalancing. A spot conversion of a negative cross-collateral balance. The account may still be well above maintenance margin.
What you see in the API and the transaction log
private/get_account_summary and the user.portfolio.{currency} subscription show equity, margin_balance, initial_margin, and maintenance_margin for the account. Initial margin usage is above 100% when initial_margin is greater than margin_balance. Maintenance margin usage is above 100% when maintenance_margin is greater than margin_balance.
Subscribe to user.liquidation for the engine itself, rather than for the emails:
liquidation_startedandliquidation_completedwhen the maintenance-margin liquidator starts and stops.close_out_liquidation_startedandclose_out_liquidation_completedfor the LSP and ADL stage.lsp_transferoradl_transferwhen a position is moved off your account, including the instrument, amount, direction, price, and commission.adl_transfer_receivedwhen an ADL position is moved onto your account.
A main account can watch the same events for its isolated-margin subaccounts on user.isolated.liquidation. The payload is the same, with isolated set to true and user_id set to the subaccount. Details are in the LSP API guide.
On a trade (user.trades, or the private trade history methods), liquidation is M when the maker was liquidated, T when the taker was liquidated, and MT when both were. The field is omitted when neither side was liquidated. On an order, is_liquidation is true for a liquidation order. A spot order placed to rebalance negative equity has is_rebalance set to true. That order is not a liquidation order.
In private/get_transaction_log, and on the Transaction log page:
A liquidation trade is type
trade. Searching forliquidationreturns those trades, and also entries of typeliquidation transfer. On a transfer,roleissource(the position left this account) ordestination(this account received it).An LSP move is type
LSP transfer. A commission, when charged, is a separate entry of typeLSP commission.An ADL move is type
ADL transfer, withADL commissionwhen a commission is charged. Both sides of the move use the same type.rolesays which side the entry is.A shortfall covered by the insurance fund is type
transfer from insurance.A socialised loss, if one were applied, would be type
socialized fundwhen charged, orsocialized refundwhen returned.The cross-collateral fee on negative equity is type Negative equity fee. The API query keyword is
negative_balance_fee. This is not a liquidation.An account rebalancing fill is an ordinary spot
trade. It is not typeliquidation transfer. The order behind it hasis_rebalanceset totrue.