Per Market Leverage
Per market leverage introduces market specific leverage limits, giving traders finer control over their positions while improving account safety.
Instead of every position sharing a single account level limit, each perpetual market now defines its own maximum leverage cap.
This allows higher leverage on stable assets and stricter limits on more volatile ones.
How Per Market Leverage Works
Each perpetual position stores its own max_margin_ratio, which defines the maximum leverage allowed for that market.
When checking a position, Drift compares:
effective_margin_ratio = min(position.max_margin_ratio, account.max_margin_ratio)BTC-PERP
10x
20x
10x
Account limit applies
PUMP-PERP
10x
5x
5x
Market limit applies
The lower value is always used, ensuring positions can’t exceed the most conservative limit.
From this ratio, the protocol calculates the maximum position size a trader can open with their available collateral, and the liquidation threshold for that specific position.
Risk and Control
Previously, all risk was managed at the account level, which meant that a large loss in one market could impact every position.
With per market leverage, each market is evaluated independently. Furthermore, per market leverage gives traders more flexibility and control:
Apply different leverage levels for different strategies or market conditions.
High-risk markets can be capped without restricting more stable ones.
Because risk is contained at the market level, traders eliminate the chance of cascading liquidations.
Each market’s leverage and liquidation levels are clear and more predictable.