Leverage does one thing to your liquidation price: it pulls it closer to your entry price, in rough proportion to the multiple you use. At 10x leverage, a price move of about 10% against you is generally enough to wipe out your margin and trigger a forced close, according to two independent trading-education pieces, from KuCoin (20 April 2026) and Phemex (6 March 2026).
Both outlets describe the same underlying mechanic. Nothing in either article’s text shows it drawing on the other, which suggests, without proving it outright, that the pattern isn’t a quirk of one exchange’s teaching material.
What liquidation actually is
Liquidation is the automatic, forced closing of a leveraged position once losses have eaten through the trader’s posted collateral, according to Bitstamp’s education page (10 September 2024). Bitstamp describes the collateral a trader puts up before opening a leveraged trade as the initial margin, and the liquidation price as the level at which that margin is exhausted and the exchange steps in. Bitstamp notes the liquidation price is generally shown to the trader when they open the position, and that it sits closer to entry the more leverage is used: a 5x long on Bitcoin, in Bitstamp’s example, has a liquidation price much further from entry than a 20x long on the same trade.
The worked numbers
KuCoin’s 20 April 2026 explainer lays out the arithmetic directly. On a 10x leveraged long, a 5% price move in the trader’s favour produces a 50% gain on the posted collateral. The same 5% move against the trader erases 50% of the margin. A 10% adverse move, in KuCoin’s account, triggers liquidation and the loss of the full deposit. KuCoin also gives figures for other multiples: on a 100x position, a move of under 1% against the trader is enough to liquidate; on a 5x position, KuCoin puts the cushion at roughly 20%; on a 3x position, roughly 33%.
Phemex’s 6 March 2026 article gives two figures that sit inside the same pattern: a 10% adverse move at 10x leverage, or a 2% move at 50x leverage, can each wipe out a trader’s margin, Phemex reports. Put the two outlets’ numbers side by side and a consistent shape appears: the higher the multiple, the smaller the percentage move needed to reach zero.
| Leverage | Approx. move to liquidation | Source |
|---|---|---|
| 100x | under 1% | KuCoin, 20 April 2026 |
| 50x | about 2% | Phemex, 6 March 2026 |
| 10x | about 10% | KuCoin, 20 April 2026; Phemex, 6 March 2026 |
| 5x | about 20% | KuCoin, 20 April 2026 |
| 3x | about 33% | KuCoin, 20 April 2026 |
KuCoin’s own example of a $1,000 account opening a $10,000 position illustrates the leverage side of the same trade: a $1,000 deposit at 10x controls $10,000 of exposure, so the gains and losses on that $10,000 are what get measured against the original $1,000, not against the larger position size.
Why the real liquidation price is usually worse than the theoretical one
The percentages above describe a clean, static case. In practice, KuCoin and Phemex both flag three things that move the real liquidation price closer than that simple math suggests.
First, funding rate payments. On a perpetual futures contract, a trader holding a leveraged long pays a periodic fee when funding rates are positive, and KuCoin describes this as a cost that gradually moves the liquidation price nearer with every funding interval. Phemex separately notes that traders often overlook these ongoing fees when they size a position.
Second, slippage during the forced close itself. KuCoin explains that when a position is liquidated it is closed with a market order, and in a fast-moving or thin market that order can fill below the theoretical liquidation level — meaning the loss can exceed the original margin.
Third, liquidation cascades. Both KuCoin and Phemex describe the same chain reaction: a cluster of leveraged positions gets liquidated together, the forced selling (or buying, for shorts) pushes price further in the adverse direction, and that triggers further liquidations. The Block’s research team, in a note reviewed for this page, describes the mechanical core of that chain in one sentence: “When long positions are forcibly closed, they effectively become market sell orders, creating additional downward pressure on prices.” The Block’s team also attributes part of the severity of these cascades in crypto markets to thinner liquidity compared with traditional asset markets.
What this looked like in one dated example
CoinDesk’s 18 August 2026 report on bitcoin futures gives a live illustration of the mechanism rather than a rule to generalise from. At the time, with bitcoin trading near $64,171.96, CoinDesk identified $57,000 as a level where a cluster of leveraged long positions could face forced closure. Joao Wedson, described by CoinDesk as chief executive of crypto analytics platform Alphractal, told CoinDesk: “$57,000 is a key region to watch. If Bitcoin trades down into that area, we could see a massive wave of long liquidations.” CoinDesk also reported that the trading range from that October’s highs above $126,000 had, by 18 August 2026, cut prices roughly in half, against past bear-cycle drawdowns of 76% to 84% cited in the same article.
A separate, earlier snapshot shows what a liquidation-heavy period looks like in dollar terms. AMBCrypto, reporting on 29 January 2026 and citing data from Coinglass, said a single hourly liquidation event had cleared more than $230 million in long positions while short liquidations in the same window stayed below $5 million. AMBCrypto attributed the largest share of that activity to Binance, at roughly $36 million in long liquidations, and Hyperliquid, at over $59 million, against total short liquidations across tracked exchanges of $3.5 million in the same period. These are dated market conditions, not a benchmark — they illustrate the skew a cascade can produce, not a level that recurs on a schedule.
How this changes what “low leverage” means in practice
KuCoin’s reporting notes that professional and experienced independent traders typically use leverage in the 3x to 5x range rather than the higher multiples common among retail traders, and frames the leverage multiple as the last variable chosen, after the stop-loss and position size. KuCoin’s example: a trader using 3x leverage on 10% of an account has an effective leveraged exposure of only 30% of total capital, which KuCoin contrasts with a retail trader applying 20x to an entire balance.
The common misreading
The percentages above get treated as an exact, guaranteed threshold — as in, “10x means I’m safe until a 10% move.” KuCoin and Phemex both present the figure as a simplified illustration, not a guarantee, precisely because funding costs, slippage, and (per Bitstamp) the specific rules an exchange sets for margin can each move the real liquidation trigger closer than the round number suggests.
What this page does not tell you
This page cannot tell a reader their exact liquidation price on any specific exchange. No primary exchange documentation — a margin or liquidation-tier table published by an exchange itself — was reviewed for this page. The percentages from KuCoin and Phemex are illustrative examples from educational articles, not sourced from an exchange’s own liquidation-engine rules, and neither article specifies how maintenance margin requirements (as distinct from losing the full initial margin) change the actual trigger point.
The dated market figures here — CoinDesk’s $57,000 level as of 18 August 2026, and AMBCrypto’s hourly liquidation totals as of 29 January 2026 — describe conditions at a specific moment and will be stale by the time this page is read again. They are included to show what the mechanism looks like in an actual market, not as a level or condition that recurs predictably.
Finally, none of the sources reviewed specify how a given exchange’s fee schedule, order-book depth, or margin-tier system would change the worked percentages above for a real account. A reader sizing an actual position should treat the round numbers in this page as a starting intuition, not a substitute for the specific liquidation price an exchange displays before a trade is opened.
Sources
Every fact above is attributed to one of these reports. Where they disagree, the article says so.
