Summary
Learn the difference between initial margin and maintenance margin on Hype perps, and how isolated margin limits risk to each position.
Initial margin is the USDC required to open a perps position. It is the collateral locked from your available perps cash balance when the trade opens.
The amount of initial margin depends on position size and leverage.
Example:
- A 1,000 USDC position at 10x leverage requires 100 USDC of initial margin.
- A 1,000 USDC position at 5x leverage requires 200 USDC of initial margin.
Higher leverage requires less initial margin for the same position size, but it increases liquidation risk.
Maintenance margin is the minimum collateral required to keep the position open. As long as the margin in the position stays above the maintenance margin requirement, the position remains open. If the margin falls below the requirement, the position is liquidated automatically.
Your leverage choice affects the gap between initial margin and maintenance margin. Higher leverage starts the position closer to the maintenance margin floor. Lower leverage starts the position with more collateral and more room before liquidation.
Hype perps use isolated margin. Each position has its own dedicated collateral. If one position is liquidated, only that position's allocated margin is at risk. Other positions and the rest of your perps cash balance are not used to cover that liquidation.
FAQ
What is initial margin?
Initial margin is the USDC collateral required to open a position.
What is maintenance margin?
Maintenance margin is the minimum collateral required to keep a position open.
What does isolated margin mean?
Isolated margin means each position has separate collateral, so liquidation affects only that position's allocated margin.
Related articles: Leverage on Perps, Adjusting Margin on an Open Position, Liquidation on Perps.
Legal Notice
Perpetuals ("Perps") are provided by third-party protocols and are not available to U.S. Persons (citizens, residents, or anyone located in the U.S.). Do not attempt to access perps from within the United States.
For purposes of these Terms, a "U.S. Person" means: (i) any natural person resident in the United States; (ii) any citizen or permanent resident of the United States, including any such person temporarily located outside the United States; (iii) any entity organized or incorporated under the laws of the United States or any state thereof; (iv) any estate of which any executor or administrator is a U.S. Person; (v) any trust of which any trustee is a U.S. Person; (vi) any agency or branch of a non-U.S. entity located in the United States; (vii) any discretionary or non-discretionary account held by a dealer or fiduciary organized, incorporated, or (if an individual) resident in the United States; or (viii) any entity organized or incorporated outside the United States that is formed by a U.S. Person principally for the purpose of investing in unregistered securities or derivative instruments. "United States" means the United States of America, its territories and possessions, any state of the United States, and the District of Columbia.
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YOU ACKNOWLEDGE THAT PERPS TRADING CARRIES SUBSTANTIAL RISK OF LOSS. YOU HEREBY RELEASE AND HOLD HARMLESS HYPESHOT, INC. AND ITS AFFILIATES, REPRESENTATIVES, AGENTS, PERSONNEL, PARTNERS, LICENSORS, SERVICE PROVIDERS, OFFICERS, DIRECTORS, EMPLOYEES, AND CONTRACTORS (COLLECTIVELY, THE "COMPANY PARTIES") FROM ANY AND ALL LOSSES, DAMAGES, OR CLAIMS ARISING FROM OR IN CONNECTION WITH YOUR USE OF PERPS FUNCTIONALITY, INCLUDING BUT NOT LIMITED TO LOSSES FROM LIQUIDATION, LEVERAGE, MARKET MOVEMENTS, PROTOCOL FAILURES, OR THIRD-PARTY ACTIONS.