# Liquidation

<figure><img src="https://351737833-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FTUg3AVExvZpfO7HXCyb6%2Fuploads%2FR4nW9xapW7Bf80zC9f91%2Fimage.png?alt=media&#x26;token=30d474df-bd39-4c57-9816-ff43786c6ae4" alt=""><figcaption></figcaption></figure>

Let's look at the example, since only 2.41 USD worth of tokens is used as collateral to open the position, there will be a price at which the loss amount is very close to the collateral amount.&#x20;

This is the Liquidation Price and is calculated as the price at which the (collateral - losses - borrow fee) is less than 1% of your position's size. If the token's price crosses this point then the position will be automatically closed.&#x20;

Due to the borrow fee your liquidation price will change over time, especially if you use a leverage that is more than 10x and have the position open for more than a few days, so it is important to monitor your liquidation price.&#x20;

If there is any collateral remaining after deducting losses and fees, then the corresponding amount would be returned to your account.&#x20;