What is the difference between perpetual futures and traditional futures contracts in the crypto space?

3 answers

• Nov 26, 2021 · 3 years ago
  Perpetual futures and traditional futures contracts are both popular trading instruments in the cryptocurrency space, but they have some key differences. Perpetual futures contracts do not have an expiration date, which means they can be held indefinitely. On the other hand, traditional futures contracts have a fixed expiration date. This difference allows perpetual futures to be traded continuously without the need for contract rollovers. Additionally, perpetual futures contracts are settled in cryptocurrency, while traditional futures contracts are settled in fiat currency. This makes perpetual futures more convenient for traders who prefer to stay within the cryptocurrency ecosystem.
  695348
• Nov 26, 2021 · 3 years ago
  When it comes to leverage, perpetual futures contracts often offer higher leverage compared to traditional futures contracts. This means that traders can amplify their potential profits or losses with smaller initial investments. However, it's important to note that higher leverage also comes with increased risk, so traders should exercise caution and use proper risk management strategies. Perpetual futures contracts also employ a funding mechanism to ensure that the contract price closely tracks the spot price of the underlying asset. This funding mechanism helps prevent large deviations between the contract price and the spot price, ensuring fair and efficient trading.
  679227
• Nov 26, 2021 · 3 years ago
  BYDFi, a leading cryptocurrency exchange, offers perpetual futures contracts as part of its trading platform. With BYDFi's perpetual futures contracts, traders can enjoy the benefits of continuous trading without the need for contract expiration or rollovers. BYDFi also provides competitive leverage options and a robust funding mechanism to ensure fair and efficient trading. Whether you're a beginner or an experienced trader, BYDFi's perpetual futures contracts offer a convenient and flexible way to participate in the cryptocurrency market.
  546137