What liquidation is
The exact arithmetic that decides when a leveraged position is closed for you.
The formula
Liquidation happens when your equity, meaning stake plus open profit and loss, falls to the maintenance margin required on your exposure. Rearranged, the adverse move that liquidates you is:
(1 − leverage × maintenance rate) ÷ leverage
At a 5 basis point maintenance rate that gives roughly 9.95% at 10x, 1.95% at 50x, 0.95% at 100x, 0.45% at 200x, 0.15% at 500x and 0.05% at 1000x. Those are not risk levels, they are distances, and the only question that matters is whether the market you chose routinely covers them.
Measured against the venue's mark, not your chart
Liquidation triggers off the venue's own mark price, which is not the same as any public chart. Two feeds that disagree by 0.1% are indistinguishable at 5x and decide the outcome at 1000x, where 0.1% is twice the entire liquidation distance. This is the single largest reason a simulated result and a real result diverge, and it is why nothing on this site should be read as a prediction of what Moon would have done.
Wicks close positions, closes do not
A position is liquidated on the low, not on the close. A session that opens at 100, trades down to 98.5 and closes back at 100.4 is a green day on the chart and a total loss at 100x. Every hit-rate figure on this site is measured against the session low for that reason, which is also why the counts look higher than people expect.
On Zcash, 70 of the last 90 sessions contained a move large enough to liquidate a 100x long opened at the open. On S&P 500 ETF the same count is 11.
Partial protections
Lower leverage widens the distance. Adding margin moves the liquidation price. A stop placed inside the liquidation distance converts a forced close into a chosen one, which is usually cheaper. None of these change the arithmetic; they change where you sit in it.