The Essence Of Crypto Futures


The majority of cryptocurrency exchanges offer the tool of futures trading. It’s not the same as exchanging cryptocurrency, but a rather more difficult feature. It implies that traders forecast or bet on the rate of a cryptocurrency at some exact point in time, and agree to buy or sell the asset by the day when the period expires and at a fixed price they have agreed beforehand.

The Essence Of Crypto Futures

Such an agreement allows traders to hedge risks connected with the high volatility of the market and buy or sell digital currency at a price they have fixed. The trader faces difficulty when one makes a wrong forecast (for example, the price will grow), and it moves in the opposite direction (drops). In such a case, the trader risks wasting more money on purchasing the asset, than expected. Or in a reverse situation, to sell the asset at a loss.

Crypto futures are available on the majority of popular cryptocurrency exchanges such as:

  • BitMex
  • WhiteBIT
  • eToro
  • ByBit
  • Deribit
  • Bitcoin Features
  • Etc.

To start trading BTC futures, you can use any of these platforms.

How Does Crypto Futures Work

As we have mentioned at the beginning of this article, participants of a deal agree on the price of the asset. The day when the contract is fulfilled and the asset must be sold (bought) is called the “expiration date”. Until the date comes, parties can sell their contracts to others, and that will not change the settled contract conditions in no way.

Also, pay attention to how much your contract would cost on different platforms. This is called “units per contract” and means how much of the underlying asset each contract is worth. The result may vary on different exchanges.

Some crypto platforms allow users to borrow assets from the platform’s capital or from other users, to increase the amount of user’s bet. That is called “leverage”, and it can be X10, X20, even X100. Borrowing assets for leverage bears high risks for a trader while at the same time multiplying investments, thus, possibility to multiply a profit.


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