DeFi Liquidation Price Calculator
Calculate the liquidation price, health factor and liquidation penalty for a collateralised loan, and see how far the collateral can fall before a liquidator takes it.
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The liquidation price is where the position stops being yours
A lending protocol lets you borrow against collateral up to a limit, and it monitors the ratio continuously. When the collateral value falls far enough that the ratio breaches the liquidation threshold, anyone may repay part of your debt and take a corresponding amount of your collateral, plus a bonus paid out of that collateral. The bonus is what makes liquidation happen instantly and reliably: it is a standing offer to the whole market, and there is no grace period, no notification and no queue.
The borrowing limit and the liquidation threshold are different numbers
A protocol may let you borrow at 75 percent of collateral value while liquidating at 80 percent. Borrowing to the maximum therefore places you a few percent from liquidation on the day you open the position, before any price movement at all. The gap between the two figures is the entire buffer the protocol gives you, and treating the borrowing limit as a target rather than a ceiling is the most common reason a position that looked conservative is liquidated in an ordinary week.
Interest moves the liquidation price without any price movement
Debt accrues continuously, so a position left untouched drifts toward liquidation on its own. At a variable rate that rises under demand, exactly when everyone else is also stressed, the drift accelerates in the conditions where the collateral is also falling. A position that is safe at today's rate and today's price can be liquidated by the passage of time alone, which is why an unattended position needs a much wider margin than an attended one.
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Frequently Asked Questions
What is the health factor?
Collateral value times the liquidation threshold, divided by debt. At or below 1 the position can be liquidated by anyone, and there is no grace period.
Why is the borrowing limit lower than the liquidation threshold?
The gap is the buffer. Borrowing to the maximum puts you a few percent from liquidation on day one, before any price movement, which is why the limit is a ceiling rather than a target.
Who liquidates a position?
Anyone. A bonus paid out of your collateral makes it profitable, so it is a standing offer to the whole market and it executes within seconds of the threshold being crossed.
Can interest alone liquidate me?
Yes. Debt accrues continuously and variable rates rise under demand, which is usually the same moment collateral is falling. An unattended position needs a much wider margin than an attended one.
Does adding collateral or repaying debt help more?
Repaying debt moves the liquidation price further for the same value, because it reduces the numerator of the ratio directly. Adding collateral helps too and takes more capital to achieve the same effect.
Privacy & Security
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How to Use
Enter your collateral and debt to find the liquidation price.
Disclaimer: This tool is provided "as is" without warranty of any kind. Results are for educational and utility purposes.