Margin

1. Overview

All trader margin is held internally in the perps contract as a USD value on each user’s userState.

Internal logics of the perps contract use USD amounts exclusively. Token conversion only happens at two boundaries:

Deposit — the user sends settlement currency (USDC) to the perps contract; the oracle price converts the token amount to USD and credits userState.margin.
Withdraw — the user requests a USD amount; the oracle price converts it to settlement currency tokens (floor-rounded) and transfers them out.

2. Trader Deposit

The user sends settlement currency as attached funds. The perps contract:

Values the settlement currency at a fixed ** $1 p er u ni t * * (n oor a c l e l oo k u p) .2. C o n v er t s t h e t o k e nam o u n tt o U S D :$ \mathtt{depositValue} = \mathtt{amount} \times 1 $.3. I n cre m e n t ‘ u ser St a t e . ma r g in ‘ b y$ \mathtt{depositValue}$.

The tokens remain in the perps contract’s bank balance.

3. Trader Withdraw

The user specifies how much USD margin to withdraw. The perps contract:

Computes $\mathtt{availableMargin}$ (see §8), clamped to zero.
Ensures the requested amount does not exceed $\mathtt{availableMargin} $.3. De d u c t s t h e am o u n t f ro m ‘ u ser St a t e . ma r g in ‘.4. C o n v er t s U S D t ose ttl e m e n t c u rre n cy t o k e n s a tt h e f i x e d$ 1 rate (floor-rounded to base units).
Transfers the tokens to the user.

4. Equity

A user’s equity (net account value) is:

$equity = collateralValue + \sum unrealisedPnl - \sum accruedFunding$

where $collateralValue$ is the USD value of the user’s deposited margin (userState.margin).

Per-position unrealised PnL is:

$unrealisedPnl = size \times (oraclePrice - entryPrice)$

and accrued funding is:

$accruedFunding = size \times (fundingPerUnit - entryFundingPerUnit)$

Positive accrued funding is a cost to the trader (subtracted from equity). Refer to Funding for details on the funding rate.

5. Initial margin (IM)

$IM = \sum ∣ size ∣ \times oraclePrice \times imr$

where $imr$ is the per-pair initial margin ratio. IM is the minimum equity required to open or hold positions. It is used in two places:

Pre-match margin check — verifies the taker can afford the worst-case 100 % fill (see Order matching §5).
Available margin calculation — determines how much can be withdrawn or committed to new limit orders (see §8 below).

When checking a new order the IM is computed with a projected size: the user’s current position in that pair is replaced by the hypothetical post-fill position ( $currentSize + orderSize$ ). Positions in other pairs use their actual sizes.

6. Maintenance margin (MM)

$MM = \sum ∣ size ∣ \times oraclePrice \times mmr$

where $mmr$ is the per-pair maintenance margin ratio (always $\leq imr$ ). A user becomes eligible for liquidation when:

$equity < MM$

See Liquidation for details.

7. Reserved margin

When a GTC limit order is placed, margin is reserved for the worst-case scenario (the entire order is opening):

$reservedPerOrder = ∣ openingSize ∣ \times limitPrice \times imr$

The user’s total $reservedMargin$ is the sum across all resting orders. Reserved margin is released proportionally as orders fill and fully released on cancellation. Reduce-only orders reserve zero margin (they can only close).

See Order matching §10 for when reservation occurs.

8. Available margin

$available = max (0, equity - usedMargin - reservedMargin)$

where $usedMargin$ is the IM of current positions (§5 formula applied to actual sizes, without any projection). This determines how much can be withdrawn (§3) or committed to new limit orders.

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