A Margin Call is a financial event where the lender asks the borrower for additional margin in order to prevent the liquidation of his existing collateral due to minimum collateral requirements.

In the context Decentralized Finance (DeFi), a margin call is often issued by a lending protocol or margin trading platform when the value of the collateral in a user’s margin account falls below a certain level.

For example, if a user has borrowed funds from a DeFi lending protocol and the value of the collateral in their margin account falls below the required level, the lending protocol may issue a margin call and request that the user add more collateral to their account. If the user is unable to add additional collateral, their position may be liquidated and they may be required to repay the loan in full.

Margin calls are a common feature of DeFi lending protocols and margin trading platforms, and are used to protect the platform and other users from the risks associated with defaulting on a loan or losing money on a leveraged trade.

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