Auto Deleveraging

1. What is Auto Deleveraging(ADL) ?

When a trader's position triggered liquidation, it will be taken over by Kine liquidity pool. Meantime, if after the take over,platform position hit limit, then the over exposed position will need to be cleared by reducing equivalent amount of opposite position from all other traders. The process of reducing equivalent amount of opposite position is called Auto Deleveraging(ADL).

2. What is the ADL priority ranking rule ?

Essentially, higher position PNL percentage and leverage contributes to higher ADL priority. Below is the calculation:

Ranking = Unrealized PnL/Position Margin * Margin Ratio