Mark Price vs Last Price: Why Liquidations Use Mark Price

If you have ever watched the price wick down, expected to be liquidated, and somehow survived — the mark price is why. Exchanges do not liquidate you on the last traded price. Here is the difference.

Last price

The last price is exactly that: the price of the most recent trade on that contract. It is what you see flashing on the ticker, and it is easy to move with a single large order, especially on thin books.

Mark price

The mark price is a calculated reference designed to resist manipulation. It is built from the index price (an average of spot prices across several major exchanges) plus a small funding basis. Because it is averaged across venues, no single trade on one exchange can yank it around.

Why it matters

Exchanges use the mark price — not last price — to calculate your unrealised PnL and to decide when you are liquidated. That protects you: a brief manipulated wick on the last price will not liquidate a position whose mark price never reached the trigger. It is also why your liquidation may not fire exactly where the ticker briefly printed.

Our liquidation calculator estimates the level; on a real exchange the trigger is measured against the mark price. Learn the formula in how to calculate liquidation price.