Policy
Liquidation policy
A liquidation is our last resort, and when it happens we sell only what is needed. This policy sets out exactly when collateral is sold, how much, at what price and at what cost.
- Partial sales only, back to 65%
- 1% fee, only on the amount sold
- 72 hours to act on a margin call
- Every surplus returned to you
Last updated 9 October 2026
Your collateral secures your loan. If its value falls far enough, part of it may have to be sold to protect both of us. This page describes how that works at Lombard Private, in the order things happen. The binding terms are in the loan and pledge agreement; the figures for your own loan are shown in your client area.
Our principles
- A last resort. Collateral is sold only when a threshold set out in your loan agreement is reached, never at our discretion.
- Partial first. We sell the collateral needed to bring your loan-to-value back to 65%, not the whole position.
- Only what is needed. The quantity follows the published formula below, and your statement shows every figure.
- Fees only on what is sold. There is no fee for a margin call, a top-up or a repayment.
- Your surplus is yours. Whatever is not needed to repay what you owe is returned to you.
When collateral is sold
Three situations lead to a sale. Thresholds are expressed as a loan-to-value (what you owe divided by the value of your collateral) and assessed on our reference price, shown live in your client area.
| Trigger | BTC · ETH · SOL | USDT · USDC |
|---|---|---|
| Partial liquidation thresholdSale back to 65% (84% for stablecoins), at any time | 80% | 92% |
| Margin call not clearedAfter 72 hours: sale back to 65% | 70%after 72 h | 87%after 72 h |
| Full liquidation threshold, or defaultThe loan is repaid from the collateral | 90% | 95% |
Before any of this, you receive an early warning at 65% (84% for stablecoins) and a margin call at 70% (87%), both in your client area. See loan-to-value and margin calls for how they work.
How much is sold
In a partial liquidation, we sell the quantity of collateral that brings your loan-to-value back to the target at the reference price, the proceeds going to reduce your loan:
Quantity sold = (L − t × C × P) ÷ (P × (1 − t))
L: amount owed · C: quantity of collateral held · P: reference price · t: target loan-to-value (65%, or 84% for stablecoins).
A worked example
You borrowed €25,000 against 0.6774 BTC at 50% loan-to-value, with bitcoin at €73,813. Bitcoin falls to €46,133 and your loan-to-value reaches 80%:
| Owed | Collateral | LTV | |
|---|---|---|---|
| Before the sale | €25,000 | 0.6774 BTC€31,250 | 80% |
| Sold | −€13,393 | −0.2903 BTC | — |
| After the sale | €11,607 | 0.3871 BTC€17,857 | 65% |
The 1% fee on the amount sold, €133.93 here, is deducted from the sale proceeds, so your loan-to-value settles just above the target: 65.7% in this example. You keep 0.3871 BTC and their potential recovery.
A useful rule of thumb
Because a partial liquidation moves your loan-to-value from 80% to 65%, it always sells about 43% of the collateral you hold at that moment (about 50% for stablecoins). Avoiding the threshold altogether is worth far more than any fee.
Fees
| Event | Fee |
|---|---|
| Partial liquidation | 1% of the amount sold |
| Full liquidation | 2% of the amount sold |
| Early warning, margin call | €0 |
| Top-up, partial or full repayment | €0 |
These are the only fees connected with a fall in the market. The full list is in our fee schedule.
How sales are executed
Thresholds are assessed on our reference price, the same price that drives the loan-to-value shown in your client area. When one is reached, the collateral is sold on the market at the prices available at that moment. Crypto markets trade around the clock, so a sale can take place at night, at the weekend or on a public holiday.
In fast or thin markets, the execution price can be lower than the reference price, and a large sale can move the price it obtains. Your loan-to-value after a partial liquidation may therefore differ slightly from the target. Our risk disclosure explains these execution risks in more detail.
Step by step
A threshold is reached
Your loan-to-value reaches the partial-liquidation threshold, a margin call expires without being cleared, or the full-liquidation threshold is reached.
The sale is executed
The quantity needed is sold promptly from the address that holds your collateral. The transaction is visible on-chain from your loan’s address.
Your loan is reduced
The proceeds, net of the fee, are applied to what you owe. Your new loan-to-value and your remaining collateral appear in your client area.
You are informed
A message on your loan in the client area, and a browser notification if you enabled them, with a full statement of the sale.
Full liquidation and default
If your loan-to-value reaches 90% (95% for stablecoins), typically after a sudden gap in the market, or if your loan is in default under the terms of the loan and pledge agreement, we sell the collateral needed to repay the loan, accrued interest and fees in full. A fee of 2% of the amount sold applies.
Whatever remains is returned to you: collateral that was not sold goes to the address you choose, and any balance from the sale is paid to your payout account. The loan is then closed.
After a liquidation
Your client area keeps a statement of every sale: the time, the quantity sold, the execution price, the amount applied to your loan, the fee, your new loan-to-value and the collateral that remains. You can match each sale with its transaction on any block explorer.
A sale of crypto-assets may be a taxable event where you live, even when the proceeds repay a loan. Keep your statements; our guide to crypto loans and tax explains the principles.
How to avoid a liquidation
- Choose a comfortable loan-to-value. Starting at 30% rather than 60%, bitcoin can fall 63% before a partial liquidation instead of 25%.
- Enable browser notifications in your client area, on the devices you use most.
- Keep a reserve of collateral or cash to top up quickly; top-ups are always open and free.
- Act at the early warning, when you have the most time and the most choices.
- Pay interest monthly so that your loan-to-value does not creep up over time.
- Stress-test before you borrow with our liquidation price calculator.
Questions
Liquidation: straight answers.
Anything else? Our advisors answer by secure message from your client area, 7 days a week.
Help centreWill you sell all of my collateral if the market falls?
No. When your loan-to-value reaches 80%, we sell only the collateral needed to bring it back to 65%. The rest stays yours. A full liquidation only happens at 90% or if the loan is in default, and even then whatever is not needed to repay what you owe is returned to you.
How much collateral is sold in a partial liquidation?
With our thresholds, a partial liquidation sells about 43% of the collateral you hold at that moment, whatever its size, because it moves your loan-to-value from 80% back to 65%. For USDT and USDC, the share is about 50%. The exact quantity follows the formula on this page.
Which price is used to trigger a liquidation?
Thresholds are assessed on our reference price, which is shown live in your client area next to your loan-to-value. The collateral itself is sold on the market, at the prices available at the time of the sale, which can differ from the reference price in fast markets.
Can a liquidation be cancelled once it has started?
No. Once a threshold is reached, the sale is executed promptly and cannot be reversed, even if the price recovers afterwards. Acting at the early warning or on the margin call is the way to keep control.
Do you charge a fee if I meet a margin call myself?
No. Top-ups, partial repayments and full repayments are free. The 1% fee only applies to collateral sold in a partial liquidation, and the 2% fee to collateral sold in a full liquidation.
Is a liquidation taxable?
It may be. In many countries, the sale of crypto-assets is a taxable disposal, even when the proceeds repay a loan. Your client area keeps a statement of every sale with its date, quantity and price. We do not provide tax advice; check the rules where you live.
What happens to my collateral after a full liquidation?
We sell what is needed to repay the loan, accrued interest and fees in full. Whatever remains is returned to you: collateral that was not sold goes to the address you choose, and any balance from the sale is paid to your payout account.
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