The simple formula
For an isolated-margin position, a useful approximation is that price can move against you by roughly (100 / leverage)% before liquidation:
- Long liquidation ≈ entry × (1 − 1/leverage)
- Short liquidation ≈ entry × (1 + 1/leverage)
So a 10x long entered at $100 has an approximate liquidation near $90; a 10x short near $110. The higher the leverage, the closer that level sits to your entry.
A worked example
Say you go long BTC at $60,000 with 20x leverage on isolated margin. Using 1/leverage = 1/20 = 5%, the approximate liquidation price is $60,000 × (1 − 0.05) = $57,000 — only a 5% drop away.
Now compare 5x: 1/5 = 20%, so liquidation sits near $48,000. Same entry, very different survival room. This is why leverage choice is really a stop-distance choice in disguise.
Why the real level is closer
The simple formula ignores two things that always work against you: maintenance margin (the minimum equity the exchange requires, which triggers liquidation before your margin hits zero) and fees plus funding (which erode equity over time).
Together they pull the true liquidation price a little nearer than the estimate. Never trade right up to the theoretical edge — and confirm the exact number with a calculator that accounts for your margin mode and maintenance rate.