Liquidations

Margin accounts are responsible of storing the margining information of the user's positions. When the composite c-ratio for a margin account falls below maintenance ratio, the position(s) in it become open for liquidation.

Liquidators are incentivized to step in and pay off the liabilities owed by the margin accounts until the users c-ratio is back above the target ratio. Liquidators receive a liquidation fee of 5% (in the form of a discount on the collateral they provide) for maintaining the solvency of the protocol.

Because of the speed and low cost of Solana, and as implied above, liquidations can be partial. Falling below a maintenance margin level does not necessarily lead to full liquidation of a position, as it does on some blockchains and protocols.