A soft liquidation refers to the use of a dynamic close factor during liquidation. Soft liquidations are used on Euler Finance, where liquidators are allowed to repay up to the amount needed to bring a violator back out of violation (plus an additional safety factor). This means that borrowers who are only slightly in violation will often have much less than half their debts repaid during a liquidation, whilst borrowers who are heavily in violation will often have much more than half their debts repaid during a liquidation (their whole position might be closed in some circumstances).
