> For the complete documentation index, see [llms.txt](https://docs.temporal.exchange/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.temporal.exchange/2.-how-it-works.md).

# 2. How It Works

**Temporal allows trader to push their liquidation floor away at a click.** The <mark style="color:$info;">grey line</mark> depicts the liquidation floor without Temporal. The <mark style="color:green;">green line</mark> depicts the new liquidation floor pushed-away \~10%

<figure><img src="https://4006780634-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2F1B8yoXvsAdZ27KuuGlqi%2Fuploads%2Fgit-blob-7af8643629782c34783ed14db3cd8a7f131c37db%2FTemporal%20How%20It%20Works.png?alt=media" alt=""><figcaption></figcaption></figure>

**Illustrative Example**

* Trader deposits $10 margin, 10x leverage, $100 notional long BTC perp at $70k entry; ‘auto-protect’ selected.
* Auto-protect exchanges gains on \~15% of notional above $77k in return for pushing the liquidation floor \~10% lower.
* If closed at $77k: \~$7.8 profit (78% return on margin), net of \~$2.2 premium charged only when position is profitable.
* Gains equivalent to \~8x effective leverage with liquidation risk of \~5.4x leverage — \~50% more margin efficiency.
* *<mark style="color:$info;">Disclaimer: not financial advice; economics vary with liquidity depth and AMM pricing.</mark>*