How to open a contract account on Binance

Traders must first create a Binance account and enable Two-Factor Authentication (2FA) to open a contract account, where they can fund and place trades using leverage.

Nov 20, 2024 at 06:48 pm

How to Open a Contract Account on Binance

Step 1: Create a Binance Account

• Visit the Binance website (https://www.binance.com/) and click on "Register".
• Provide your email address and create a strong password.
• Complete the reCAPTCHA verification and click on "Create Account".
• You will receive a confirmation email from Binance. Click on the link provided to verify your email address.

Step 2: Enable Two-Factor Authentication (2FA)

• Once your email address is verified, log into your Binance account.
• Go to "Security" > "Two-Factor Authentication (2FA)".
• Choose between SMS or Google Authenticator and follow the instructions to set up 2FA.
• This additional security measure helps protect your account from unauthorized access.

Step 3: Fund Your Binance Account

• Binance supports a variety of methods for funding your account, including crypto deposits, bank transfers, and debit/credit cards.
• Go to "Buy Crypto" > "Cash Balance" to select your preferred funding method.
• Follow the instructions to complete the transaction and transfer funds into your Binance account.

Step 4: Open a Contract Account

• Once your Binance account is funded, go to "Derivatives" > "Contracts" and click on "Open Contract Account".
• Read and agree to the terms of service.
• Select the type of contract account you wish to open: perpetual or futures.
• Perpetual contracts are perpetual futures contracts with no set expiry date, while futures contracts have a fixed expiry date.

Step 5: Fund Your Contract Account

• To trade futures contracts on Binance, you need to transfer funds from your spot wallet to your contract account.
• Go to "Derivatives" > "Balances" and click on "Transfer".
• Enter the amount you wish to transfer and select your contract account from the dropdown menu.
• Click on "Confirm Transfer" to complete the process.

Step 6: Understanding Leverage

• Leverage allows you to borrow funds to trade with a higher position size than your initial capital.
• On Binance, the maximum leverage available for perpetual and futures contracts varies depending on the underlying asset.
• Select the appropriate leverage ratio for your trading strategy, keeping in mind that higher leverage magnifies both profits and losses.

Step 7: Place Your First Order

• To place a trade, go to "Derivatives" > "Contracts" and select the contract you wish to trade.
• Use the order form to enter the order type (market, limit, or stop), the order quantity, and the price.
• Click on "Buy" or "Sell" to place the order.
• Your order will be executed based on the market conditions and the order type you selected.

Step 8: Monitor Your Positions and Manage Risk

• Once your order is executed, you can monitor its progress by going to "Derivatives" > "Positions".
• Keep an eye on your positions and adjust them accordingly to manage risk.
• Use stop-loss orders or take-profit orders to limit potential losses or lock in profits.

Step 9: Closing Your Positions

• To close your positions, go to "Derivatives" > "Positions" and click on the "Close" button for the relevant position.
• Select the order type and the order quantity to close the position.
• Click on "Close Position" to complete the process.

Step 10: Withdraw Your Funds

• After closing your positions, you can withdraw your funds from your contract account by transferring them back to your spot wallet.
• Go to "Derivatives" > "Balances" and click on "Transfer".
• Enter the amount you wish to transfer and select your spot wallet from the dropdown menu.
• Click on "Confirm Transfer" to withdraw your funds.