Markets, prices, margin & liquidation
This guide explains the mechanics that affect every MNX trader: what each market type represents, which price controls risk, how much collateral a position needs, what happens during liquidation, and how price bands and funding work. Exact limits vary by market and are returned by GET /v0/markets.
Market types
| Type | What it represents | Funding and settlement |
|---|---|---|
| Perpetual | A continuously traded market that follows an external reference, such as a stock, an exchange-traded fund, or the H100 GPU rental price index. | Does not expire. Periodic funding payments help keep its traded price near the external reference. |
| Numeric future | A numeric rather than YES/NO outcome. OPENAI and ANTHROPIC, for example, are priced in billions of U.S. dollars of company market capitalization. | Has no periodic funding payment and settles under its published contract specification: the valuation-futures terms for company valuations, or the market's entry in Market specifications. |
| Binary future | A YES/NO outcome priced between 0 and 1, representing the market-implied probability of YES. | Has no periodic funding payment and settles to 0 or 1, or to a tie or partial value where its specification provides one. |
Binary futures in the order form
A dollar amount entered for a binary future order in the app counts what its contracts put up at 1x: a buy pays the price for each contract, and a sell that opens or adds to a short puts up one minus the price. At a price of 0.125, $100 buys 800 contracts, while $100 sold with no long is 114 contracts, which put up 0.875 each, $99.75. A sell closes your long first, and those contracts count at the price, as a close does: with a long of 100 and the price at 0.90, $90 sold closes it, and $91 closes it and opens a short of 10. Fees are charged on top. A reduce-only close entered in dollars converts them at the price, and a close by percentage of the position is sized in contracts.
Before you submit, the order summary shows To win: what comes back for the contracts the order opens if the market settles your way, at 1 for a long or at 0 for a short. That is the margin they put up at the order's leverage plus their profit, before fees, so at 1x it is $1 a contract. A short of 114 contracts at 0.125 and 4x puts up $24.94 and wins $14.25: To win reads $39.19. Contracts that close part of an open position are not counted. Through the API, an order is signed in contracts. The estimate endpoint's TARGET_NOTIONAL sizing reads a dollar amount as quantity times price on both sides, and its TARGET_VALUE sizing reads it as the order form does: a sell without reduce-only counts what closes your long at the price and the rest at one minus it.
Binary positions
A position's position_value in GET /v0/positions/by-user/:user_id/enriched is what its contracts are worth at the mark price: its size times the mark, except a binary short, which is worth one minus the mark for each contract, what it would put up to open at that price at 1x. A short of 2,934 contracts at a mark of 0.138 is worth $2,529.11. At 1x a binary position, long or short, is worth its margin plus its unrealized profit or loss. The entry, mark and liquidation prices are the contract's own price on both sides.
Oracle price and mark price
MNX publishes two prices because risk checks and a trader's displayed profit and loss (P&L) need different kinds of stability.
| Price | What it controls | How it is formed |
|---|---|---|
| Oracle | Margin checks, liquidation eligibility, and the tradable price band. | Perpetuals aggregate external reference data. Numeric and binary futures use an 8-hour EMA of MNX's internal order book because no continuously observable external price exists before settlement; the oracles of two binary futures, DPREZ and RSENATE26, are also kept from moving away from the matching Polymarket market's price. MNX's oracle signer, a separate service, computes and signs the futures and H100 prices. The oracle methodology gives the rules. |
| Mark | Unrealized P&L display and conditional-order triggers. | The median of the best bid inside the price band, the best ask inside the band, and the previous mark; a missing side counts as that edge of the band. A bid or ask counts once it has rested: it was live 400 ms before one of the market's batches sealed, or 400 ms passed with none of them settling. So a quote that never faced a batch does not move the mark; on a busy market a new quote counts about one batch cycle after it is placed. With no quotes in the band, the previous mark carries forward, clamped to the band. A market with no mark yet starts from the oracle price. |
Oracle updates are rate-limited, and stale data is not used indefinitely. If a reference stops updating, affected settlement and liquidation paths pause at their respective freshness limits rather than continuing on a stale price.
Margin and leverage
MNX uses isolated margin: each market position has its own collateral. The main quantities are:
- Notional is the total value of the position: size × price.
- Opening margin is the collateral reserved when the position opens. At 5x leverage, a 1,000 USDM position requires about 200 USDM of opening margin, before any applicable fees.
- Equity is the position's margin plus unrealized P&L and any pending funding.
- Margin ratio is equity divided by notional at the oracle price. Each market defines an initial and maintenance margin requirement; maximum leverage follows from the initial requirement. For a binary short, the margin it needs and its margin ratio are measured on its maximum loss, size × (1 − price), instead of its notional.
An order that opens a position must bring the initial margin its size requires at its fill price and leave the position at or above the maintenance requirement. An order that adds to a position at the position's leverage must bring the same for the size it adds. Such an add can fill even when the position's margin ratio is below the initial requirement, as long as, in each batch where it fills, the position is outside the liquidation buffer described below before the batch and above the maintenance requirement after it. If the position is inside the buffer, the order is refused when placed, or cancelled before a batch while it rests. The other requirements are checked when each batch clears. Reducing an existing position remains allowed. Current margin requirements and leverage limits are available from GET /v0/markets.
Changing the leverage of an open position counts its unrealized profit as margin. After any pending funding is settled, a change to leverage L sets the position's equity, its margin plus its unrealized profit or minus its unrealized loss, to 1/L of its value at the oracle price, and moves the difference between the position and your available balance. Margin does not go below zero. Binary shorts are the exception: a change sets a binary short's margin to 1/L of the most it could lose from its entry price, whatever its profit.
A position's true leverage is its value over its equity. It moves with the price, falling as the position gains and rising as it loses, and adding or removing margin and earlier leverage changes move it too, so it can sit above or below the leverage the position is set at. A change to a setting above its true leverage returns margin to your available balance and moves the liquidation price closer, even when the new leverage is below the old setting; a change to a setting below its true leverage takes margin from your available balance. For example, a long of 10 at 200, set at 10x with 200 of margin, is worth 2,345 at a price of 234.50: its equity is 545 and its true leverage 4.3x. Changing it to 5x sets its margin to 124 and returns 76; changing it to 4x adds 41.25. A binary short in profit changed from 4x to 3x adds margin and moves its liquidation price away, whatever its true leverage. The app shows the true leverage and what a change does before you apply it.
Liquidation
A position becomes eligible for liquidation when its margin ratio falls below the market's maintenance requirement. Pending funding is applied before this check. A separate 0.5-percentage-point buffer above maintenance does not trigger liquidation: orders that add to a position are refused while its margin ratio is inside the buffer, and a leverage change may not leave the position inside it. Fully collateralized 1x binary positions and 1x perpetual longs have no buffer. Margin removal is capped separately, at the position's opening margin requirement.
- Book liquidation: while the position's equity is at least two-thirds of its maintenance requirement, MNX cancels the position's open orders and submits reduce-only market orders, which can shrink or close the position but cannot reverse it. Large positions may be closed in several pieces to reduce market impact.
- Backstop: if equity is still positive but below two-thirds of the maintenance requirement, a backstop vault takes over the remaining position and the trader's position closes. The trader's remaining margin goes to the vault as its fee.
- Auto-deleveraging (ADL): if equity is zero or negative, positions on the opposite side are reduced or closed against the bankrupt position to keep the exchange solvent. They are ranked at the oracle price by profit as a share of entry value times leverage, so the most profitable, most leveraged positions go first; positions at a loss come after every profitable one. Each reduction executes at the bankrupt position's bankruptcy price, the price at which its equity is zero, not at the oracle price. In a large price gap that price can be worse than your own entry price, so a deleveraged position can close at a loss.
When a liquidation, a backstop takeover, or auto-deleveraging changes your position, the app shows a notice, at the time if it is open or on your next visit, and lists it under the notifications bell; an email goes to your account's address unless you turn liquidation alerts off in Settings. Your portfolio's Liquidations tab lists the event: the market, side, quantity, price, realized P&L, and, for a takeover, the margin forfeited. The notice and the row don't name the bankrupt account.
Fully collateralized 1x binary positions, long or short, are the exception: they post their maximum possible loss up front and are not liquidated.
Price bands and order execution
Every market has a configured band around its oracle price. A batch can clear only inside that band; a limit order outside it remains open until it becomes eligible. Bands vary by contract—for example, CRWV and SPCX currently use ±5%, while OPENAI and ANTHROPIC use ±20%. Binary-market bands also vary by contract.
MNX matches orders in frequent batch auctions at one clearing price. When one side has more volume than can trade, better prices fill first: book liquidation orders first of all, then other market orders, then limit orders by price, and the last price level that trades is shared in proportion to remaining size rather than by queue position, with lots left over after rounding going to the orders rounded down the most. Everyone pays the one clearing price. When several prices would match the same volume, the batch clears at the price the resting orders alone fill the trade at, as on a continuous order book, counting only orders that have rested in the book: a market order at the last level it reaches, and a new limit order that crosses resting orders at their price. Otherwise the batch clears at the oracle rounded to the tick if the oracle lies between those prices, and at the one nearest the oracle if not, so the shared level can sit slightly above the clearing price for buyers (below it for sellers). Each market also defines its own tick size (the smallest price increment), quantity step, and minimum and maximum order sizes. See Placing orders for the order lifecycle and GET /v0/markets for current values.
Funding
Funding applies only to perpetuals. When a perpetual trades above its reference, longs pay shorts; when it trades below its reference, shorts pay longs. The trade page shows the current hourly rate and the time until the next hourly rate update. Funding accrues every second at the current rate and is booked into your margin every hour.
Funding runs only during each market's funding session, shown as funding_session in GET /v0/markets. U.S.-listed stock perpetuals fund during the regular U.S. equity session (9:30–16:00 New York time on trading days, or until 13:00 on early-close days) and pause outside it. MINIMAX and ZAI, which are listed in Hong Kong, fund during the Hong Kong trading session. Markets with around-the-clock references, such as H100 and the BTC and ETH perpetuals, fund continuously. Numeric and binary futures have no periodic funding payment.
Stock-perpetual holders should also read the corporate-actions policy.