Leverage Management

Expiry futures use three leverage thresholds:

Rule	Value	Meaning
Minimum opening leverage	1x	A new position cannot be opened below this leverage.
Maximum opening leverage	250x	A new position cannot be opened above this leverage; this equals 40 bps initial margin.
Liquidation leverage	500x	An already-open position is liquidatable at this leverage; this equals 20 bps liquidation margin.

This creates a buffer between the opening leverage cap and the liquidation threshold. A position cannot be opened at the liquidation threshold. It can be opened up to 250x, and after it is open, price movement or collateral withdrawal can increase its effective leverage. Once effective leverage reaches 500x, the position is liquidatable.

Collateral Changes

Users can add or remove collateral in either USDC or the token asset.

Action	Effect on leverage	Rule
Add collateral	Lowers leverage	Cannot reduce effective leverage below 1x.
Remove collateral	Raises leverage	Cannot make the position liquidatable.

Effective leverage is based on remaining equity after current PnL and close fees:

$$\mathrm{EffectiveLeverage} = \frac{\mathrm{PositionNotional}} {\mathrm{Collateral}+\mathrm{PnL}-\mathrm{CloseFee}}$$