Drift Protocol v2

โŒ˜K
๐Ÿ‘พWelcome to Drift Protocol
๐ŸงฎDrift DEX
๐Ÿ‘‹Getting Started
๐Ÿ“ˆPerpetual Futures
๐Ÿ“ŠSpot Margin Trading
๐ŸฆBorrow & Lend
๐Ÿ›๏ธStaking
๐ŸชMarket Makers
๐Ÿ”ฌTechnical Explanations
๐Ÿ“Accounting and Settlement
โž—Borrow Interest Rate
๐Ÿ“œDelisting Process
โ›ฒDrift AMM
๐ŸƒJust-In-Time (JIT) Auctions
๐Ÿ“šKeepers & Decentralised Orderbook
โ˜ ๏ธLiquidators
๐Ÿ’งLiquidity Providers (LPs)
๐Ÿ“‹Protocol Guard Rails
๐Ÿ“Risks
๐Ÿ–ฅ๏ธDeveloper Resources
๐Ÿ“”Program/Vault Addresses
โŒจ๏ธSDK Documentation
โŒจ๏ธTutorial: Bots
โš ๏ธTroubleshooting
๐Ÿ› ๏ธKeeper Bots
๐Ÿ› ๏ธTrading Bots
โŒจ๏ธHistorical Data (v1)
โŒจ๏ธAPI
๐Ÿ›ก๏ธSecurity
๐Ÿ›ก๏ธAudits
๐Ÿ›ก๏ธBug Bounty
โš–๏ธLegal and Regulations
๐Ÿ“Terms of Use
๐Ÿ“Disclaimer
๐Ÿ“Privacy Policy
๐Ÿ“Competition Terms and Conditions
๐Ÿ“šGlossary
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2min

Liquidators

Liquidations act as position transfers between accounts. Liquidator accounts thus need to be collateralised in order to satisfy the transfer's initial margin requirements.

There are four instructions pertaining to liquidations:

Instruction

Details

liquidate_perp

Liquidator takes over user perpetual positions at a discount.

liquidate_borrow

Liquidator takes over borrow at a discount to the deposit value.

liquidate_borrow_for_perp_pnl

Liquidator takes over borrow for discount P&L.

liquidate_perp_pnl_for_deposit

Liquidator takes over negative P&L for discounted deposit.

Bankruptcy (see ๏ปฟ๏ปฟ๏ปฟInsurance Fund ) is possible if you still have outstanding liabilities and no further assets after liquidation.

Liquidators are open-sourced and can be triggered by anybody running a liquidator bot. Liquidators, also known as Keepers, will have their collateral reward credited to their Drift account.

Liquidations will be triggered and positions will be liquidated based on oracle price, not the mark price of the exchange.

The user's trade price at liquidation for a perpetual position will be based on the oracle price + the penalty / fee that is set per market.

In the case of an oracle error (๏ปฟ๏ปฟ): the market will pause most fills, liquidations, and funding rate updates.

If you would like to run a liquidator bot, see ๏ปฟTutorial: Liquidation Bot๏ปฟ

Updated 21 Feb 2023
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Liquidity Providers (LPs)
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