# Liquidation

Once a trade reaches the liquidation price, the liquidation engine marks the position as liquidate-able (onchain) and liquidators attempt to close the positions. As per protocol design, **liquidations incur&#x20;**<mark style="color:blue;">**no price impact**</mark>**, thereby minimizing potential losses**.

Liquidations <mark style="color:blue;">**incur a fixed fee**</mark> that is **always slightly above gas fees** in order to <mark style="color:blue;">**incentivize liquidators**</mark> closing overextended positions. At a future stage, additional incentives may be introduced to attract external liquidators and increase the robustness of the liquidation engine.