How Do Liquidations Work?

When a user doesn't have enough account balance and PnL to cover their required margin a user's account is open for liquidation.
Liquidators can then step in and take over the user's portfolio, in doing so they will get rewarded a % of the liquidatees maintenance margin.
For details see here

How Do Liquidations Work In High Volume Situations / Volatility?

This will be an area of intense scrutiny for us, and we will aim to stress-test our engine thoroughly. The good news is that by building on Solana we can build a very performant, low-latency liquidation engine. We are optimistic this will work well as other Solana projects such as Mango Markets have been able to capably handle mass liquidation events as of recent.