> For the complete documentation index, see [llms.txt](https://docs.getrekt.trade/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.getrekt.trade/wins-losses.md).

# wins losses

Each position settles independently. Its margin, direction, entry price, leverage and collateral source determine the result. Closing a position consumes it once; the same loss cannot mint rewards or pay a referral twice.

## When you win

The protocol first calculates price-based profit, applies the [asymmetric profit adjustment](broken://pages/ff0bee99a927ff20ef1e924a6b4131f14dfb165a), then deducts 2% of adjusted profit. A 10 USDC adjusted profit therefore produces 9.80 USDC of net profit.

For a cash-backed position, the original margin is returned separately from the net profit. Available LP cash pays profit; the remainder enters FIFO. Existing claims retain priority. A recorded fee deduction is not automatically a cash-backed fee payout: the retained profit-fee rule only funds the fee reserve when older claims are absent and sufficient cash remains after paying the claim.

For a debt-backed position, both the surviving debt margin and the net profit are claims on the protocol. Neither becomes guaranteed cash merely because the trade won.

## When you lose cash

A normal loss is deducted from margin, up to the position's full margin. Any surviving cash margin returns to the trader. The new allocation takes 2% of the loss as the protocol fee, then divides the remainder between the eligible referrer and the LP.

At the initial emissions rate, a 100 USDC realized loss earns 1,000,000 $REKT. With a valid referrer it also allocates 2 USDC to fees, 29.4 USDC to referrals and 68.6 USDC to the LP. These allocations come out of the same loss; they are not additional trader charges.

## When you lose a debt claim

Using 40 USDC from a 100 USDC queued claim leaves 60 USDC in the original claim. If the debt position later loses 10 USDC, its surviving 30 USDC is paid if permitted or re-enters the queue. The protocol owes 10 USDC less, but its USDC treasury does not gain 10 USDC.

The 10 USDC gross debt loss earns $REKT at the current global rate and advances the loss counter. It produces no referral reward. The retained legacy debt-close fee branch can use existing LP cash only when no older queue exists and cash covers the surviving claim plus the fee; debt liquidation has no such fee. This conditional transfer must never be reported as cash generated by debt loss.

## Liquidation is a different outcome

A hard-bust liquidation loses the whole isolated margin, including the maintenance portion. It does not return the balance that a voluntary close at the same quoted price might show. Cash liquidations use the cash-loss split; debt liquidations cancel the full debt margin and produce no referral payment. [Liquidations](broken://pages/819614cab18be7569308d56ff821d167e6e174bc).


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