To open a position on Strike Finance, you must deposit collateral. Collateral ensures the protocol can cover losses if a trade moves against you. Currently (12th May 2025), only ADA is supported as collateral for trading perpetual contracts.
Using ADA as Collateral
When opening a position, the amount of ADA you deposit determines how much leverage you can apply. The more collateral you provide, the more flexible your position is regarding size and risk tolerance.
Other assets such as iUSD, USDA, USDM, $SNEK or $STRIKE may be supported in the future via governance decision, but for now, all traders must fund their positions with ADA.
Liquidation
If the market moves against your position and your collateral value drops below the maintenance margin, the protocol will automatically liquidate your position to prevent further loss.
Upon liquidation:
- Your position is closed at the current market price.
- You may lose all or a significant portion of your collateral.
- Any remaining ADA after liquidation fees will be returned to your wallet.
Key Points to Monitor
- Track your margin ratio in the dashboard (Entry / Mark Price), showing how close you are to liquidation.
- Keep an eye on the liquidation price shown when opening a position.
- Withdraw unused collateral or adjust your leverage if needed to reduce risk.
Future Collateral Options
Strike Finance plans to support additional collateral types, including stablecoins and the $STRIKE token. These will offer more flexibility and benefits like discounted fees and access to higher leverage, but they are not currently active on the platform.
Summary
All positions on Strike Finance are currently collateralised with ADA. Liquidation is triggered when your margin ratio falls below a safe level, so careful position sizing and monitoring are critical. Additional collateral options will be added in future protocol updates, expanding user flexibility and functionality.
