How to play BitFlyer u-standard contract

BitFlyer's u-standard contracts, perpetual futures without expiration, offer leveraged trading opportunities in cryptocurrencies, allowing traders to speculate on price movements without owning the underlying assets.

Nov 18, 2024 at 09:53 pm

Step-by-Step Guide to Trading BitFlyer u-standard Contracts

1. Understanding BitFlyer u-standard Contracts

BitFlyer u-standard contracts are standardized, perpetual futures contracts traded on the BitFlyer exchange. They allow traders to speculate on the future price movements of cryptocurrencies without taking ownership of the underlying assets.

Key Features:

• Perpetual: Contracts have no expiration date, enabling continuous trading.
• Standardized: Contracts have predetermined sizes and margin requirements.
• Leveraged: Traders can amplify potential profits (and losses) by using leverage.
• Margined: Initial margin must be deposited to open and maintain positions.

2. Opening a Position

a) Log in to your BitFlyer account and navigate to the "u-standard Contract" section.

b) Select the desired cryptocurrency pair (e.g., BTC/JPY, ETH/USDT).

c) Choose "Long" to buy (anticipating price increase) or "Short" to sell (anticipating price decrease).

d) Specify the trade volume (in base currency equivalent) and leverage ratio.

e) Review the margin requirement and place the order.

3. Managing Open Positions

a) Track market movements and adjust positions as needed.

b) Add or remove margin to maintain sufficient margin levels.

c) Set stop-loss orders to limit potential losses or take-profit orders to secure gains.

4. Closing a Position

a) Go to the "u-standard Contract" section and select "My Positions."

b) Choose the desired position to close.

c) Select "Liquidate Position."

d) Confirm the closing price and receive the realized profit or loss in the settlement currency.

5. Advanced Trading Strategies

a) Hedging: Use opposite positions in multiple contracts to reduce risk exposure.

b) Scalping: Execute numerous trades in short intervals, targeting small profit margins.

c) Arbitrage: Capitalize on price discrepancies between different exchanges.

6. Risk Management

a) Understand the concept of leverage and its potential risks.

b) Set realistic profit and loss targets.

c) Employ proper risk management tools (e.g., stop-loss orders).

d) Monitor market sentiment and economic factors that may influence prices.

7. Trading Fees and Commissions

BitFlyer charges a maker-taker fee structure:

• Maker fees: Rebate for providing liquidity to the order book (typically 0% to 0.01%).
• Taker fees: Charged for taking liquidity from the order book (typically 0.05% to 0.20%).

Additional fees:

• Overnight funding fee: Paid by traders holding positions overnight, based on supply and demand dynamics.
• Liquidation fee: Penalties for failure to maintain sufficient margin levels.