-
Bitcoin
$83,363.2738
-1.04% -
Ethereum
$1,896.3860
-1.68% -
Tether USDt
$0.9995
-0.06% -
XRP
$2.3356
-2.21% -
BNB
$631.1123
3.75% -
Solana
$128.5517
-4.88% -
USDC
$0.9997
-0.03% -
Dogecoin
$0.1715
-2.53% -
Cardano
$0.7145
-3.50% -
TRON
$0.2122
-3.47% -
Pi
$1.4066
-6.51% -
Chainlink
$13.6527
-3.11% -
UNUS SED LEO
$9.5751
-2.50% -
Toncoin
$3.4601
-0.52% -
Stellar
$0.2715
-0.81% -
Hedera
$0.1931
0.56% -
Shiba Inu
$0.0...01319
1.42% -
Avalanche
$18.4907
-4.87% -
Sui
$2.2782
-2.23% -
Litecoin
$92.5554
0.23% -
Polkadot
$4.3962
1.79% -
MANTRA
$6.9586
5.00% -
Bitcoin Cash
$332.9865
-1.68% -
Ethena USDe
$0.9994
-0.04% -
Dai
$1.0001
0.01% -
Bitget Token
$4.4168
-1.29% -
Hyperliquid
$13.5702
-0.51% -
Monero
$210.3788
-0.44% -
Uniswap
$6.1464
-2.03% -
Aptos
$5.3406
-0.04%
What is a coin perpetual contract?
Perpetual contracts in cryptocurrency trading offer traders continuous trading without expiration dates, allowing them to speculate on price fluctuations with leverage.
Oct 22, 2024 at 07:48 pm

What is a Coin Perpetual Contract?
A coin perpetual contract is a financial instrument that allows traders to speculate on the future price of a cryptocurrency without taking physical delivery of the asset. It is a derivative contract that tracks the price of a specific coin and typically has no expiration date.
Unlike futures contracts, which have a set expiration date, perpetual contracts allow traders to hold positions indefinitely. They are also traded with leverage, which means traders can control a larger position size with a smaller amount of capital.
Components of a Perpetual Contract:
1. Contract Value: The total value of the contract is determined by the contract size, which is usually standardized for each contract.
2. Asset Price: The price of the underlying cryptocurrency that the contract tracks.
3. Index Price: A reference price used to calculate the settlement price of the contract.
4. Funding Rate: A periodic payment made between long and short positions to balance the funding of the contract.
How Perpetual Contracts Work:
- Open a Position: Traders can open a long position to bet that the price of the cryptocurrency will rise, or a short position to bet that it will fall.
- Define Leverage: Traders can use leverage to multiply their position size and gain potential profits or losses.
- Maintain Margin: Traders need to maintain a sufficient margin balance in their account to cover potential losses.
- Settlement: Perpetual contracts do not expire, but they can be closed by the trader at any time. The profit or loss is realized at the time of closing the position.
Advantages of Perpetual Contracts:
- Continuous Trading: No expiration dates allow traders to hold positions for as long as they desire.
- Leverage: Traders can amplify their potential returns and capitalize on price fluctuations.
- No Physical Delivery: Traders speculate on the price without the hassle of owning or delivering the underlying asset.
Risks of Perpetual Contracts:
- Volatility: Cryptocurrency prices can be highly volatile, leading to substantial price swings and potential losses.
- High Leverage: Leverage can magnify both profits and losses, leading to significant capital depletion.
- Funding Rate: Funding rates can vary and impact the profitability of perpetual contract positions.
Summary:
Coin perpetual contracts are financial instruments that enable traders to speculate on the future price of a cryptocurrency with leverage. They provide continuous trading, margin trading, and no physical delivery, but also carry the risks of volatility, high leverage, and potential losses.
Disclaimer:info@kdj.com
The information provided is not trading advice. kdj.com does not assume any responsibility for any investments made based on the information provided in this article. Cryptocurrencies are highly volatile and it is highly recommended that you invest with caution after thorough research!
If you believe that the content used on this website infringes your copyright, please contact us immediately (info@kdj.com) and we will delete it promptly.
- Bitcoin (BTC) Price Prediction: Will BTC Hit Rp1.63T ($100K) After the Fed's Decision?
- 2025-03-17 14:50:57
- New RBI governor Sanjay Malhotra announces expansion of United Payments Interface (UPI)
- 2025-03-17 14:50:57
- The Bitcoin call options contracts open than put options
- 2025-03-17 14:50:57
- Han Lin Shares Gate.io's Entrepreneurial Journey, Platform Strategic Evolution, and Industry Insights
- 2025-03-17 14:50:57
- The 5 Altcoins That Should Be Sold Before the End of March
- 2025-03-17 14:45:57
- Melania Trump Cryptocurrency, MELANIA/USD, Surges 6.29% as a Whale Opens 5x Leveraged Long Position
- 2025-03-17 14:45:57
Related knowledge

What is the difference between the mark price and the latest price on Binance Futures?
Mar 17,2025 at 02:36pm
Key Points:Mark Price: A fair price calculated using multiple exchanges' prices, minimizing manipulation. It's crucial for funding rates and liquidation calculations.Latest Price: The most recent trade price on Binance Futures. Subject to volatility and potential manipulation.Discrepancies: Differences arise due to market depth, order book imbalances, a...

How to operate cross-product arbitrage of Bitcoin contracts?
Mar 17,2025 at 01:00pm
Key Points:Understanding Bitcoin contract arbitrage relies on exploiting price discrepancies across different exchanges.Successful arbitrage requires speed, low latency connections, and sophisticated trading algorithms.Risk management is crucial, as market volatility and slippage can negate profits.Fees and slippage significantly impact profitability. C...

How is the funding rate of Bitcoin contracts calculated?
Mar 17,2025 at 10:30am
Key Points:Bitcoin perpetual contracts utilize funding rates to align the price of the contract with the spot price of Bitcoin.The funding rate is calculated based on the difference between the perpetual contract price and the spot price, and the demand for long or short positions.A positive funding rate means long positions pay short positions, and vic...

How to avoid the risk of liquidation in Bitcoin contracts?
Mar 17,2025 at 09:56am
Key Points:Understanding Margin and Leverage: The core of avoiding liquidation lies in responsible leverage use.Monitoring Market Volatility: Sudden price swings are the biggest liquidation threat. Constant vigilance is crucial.Position Sizing and Risk Management: Never risk more than you can afford to lose. Proper position sizing is paramount.Stop-Loss...

What are the advantages of smart contracts?
Mar 14,2025 at 11:51pm
Key Points:Enhanced Security: Smart contracts minimize the risk of fraud and human error through automated execution.Increased Transparency: All transactions and contract terms are publicly viewable on the blockchain, fostering trust and accountability.Automation & Efficiency: Smart contracts automate processes, eliminating intermediaries and speeding u...

What are the application scenarios of smart contracts?
Mar 13,2025 at 03:26pm
Key Points:Smart contracts automate agreements, removing intermediaries.Diverse applications across DeFi, NFTs, supply chain management, and more.Security and scalability remain key challenges.Understanding the underlying blockchain technology is crucial for effective implementation.Legal frameworks are still evolving to accommodate smart contract dispu...

What is the difference between the mark price and the latest price on Binance Futures?
Mar 17,2025 at 02:36pm
Key Points:Mark Price: A fair price calculated using multiple exchanges' prices, minimizing manipulation. It's crucial for funding rates and liquidation calculations.Latest Price: The most recent trade price on Binance Futures. Subject to volatility and potential manipulation.Discrepancies: Differences arise due to market depth, order book imbalances, a...

How to operate cross-product arbitrage of Bitcoin contracts?
Mar 17,2025 at 01:00pm
Key Points:Understanding Bitcoin contract arbitrage relies on exploiting price discrepancies across different exchanges.Successful arbitrage requires speed, low latency connections, and sophisticated trading algorithms.Risk management is crucial, as market volatility and slippage can negate profits.Fees and slippage significantly impact profitability. C...

How is the funding rate of Bitcoin contracts calculated?
Mar 17,2025 at 10:30am
Key Points:Bitcoin perpetual contracts utilize funding rates to align the price of the contract with the spot price of Bitcoin.The funding rate is calculated based on the difference between the perpetual contract price and the spot price, and the demand for long or short positions.A positive funding rate means long positions pay short positions, and vic...

How to avoid the risk of liquidation in Bitcoin contracts?
Mar 17,2025 at 09:56am
Key Points:Understanding Margin and Leverage: The core of avoiding liquidation lies in responsible leverage use.Monitoring Market Volatility: Sudden price swings are the biggest liquidation threat. Constant vigilance is crucial.Position Sizing and Risk Management: Never risk more than you can afford to lose. Proper position sizing is paramount.Stop-Loss...

What are the advantages of smart contracts?
Mar 14,2025 at 11:51pm
Key Points:Enhanced Security: Smart contracts minimize the risk of fraud and human error through automated execution.Increased Transparency: All transactions and contract terms are publicly viewable on the blockchain, fostering trust and accountability.Automation & Efficiency: Smart contracts automate processes, eliminating intermediaries and speeding u...

What are the application scenarios of smart contracts?
Mar 13,2025 at 03:26pm
Key Points:Smart contracts automate agreements, removing intermediaries.Diverse applications across DeFi, NFTs, supply chain management, and more.Security and scalability remain key challenges.Understanding the underlying blockchain technology is crucial for effective implementation.Legal frameworks are still evolving to accommodate smart contract dispu...
See all articles
