Which type of contract, perpetual futures or traditional futures, is more commonly used by cryptocurrency traders?

3 answers

• Manoj RajputJun 03, 2024 · a year ago
  Perpetual futures contracts are the go-to choice for most cryptocurrency traders. These contracts have no expiration date, allowing traders to hold positions indefinitely. They are popular due to their flexibility and the absence of funding fees that are typically associated with traditional futures contracts. Traders can take advantage of leverage to amplify potential gains or losses. However, it's important to note that perpetual futures contracts also carry the risk of liquidation if the position moves against the trader. Overall, perpetual futures contracts offer more opportunities for traders to profit from short-term price movements and are widely used in the cryptocurrency trading community.
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• Afifa MasoodFeb 14, 2024 · a year ago
  Cryptocurrency traders predominantly opt for perpetual futures contracts over traditional futures contracts. The key advantage of perpetual futures contracts is that they don't have an expiration date, allowing traders to hold positions for as long as they desire. This flexibility is highly valued in the fast-paced world of cryptocurrency trading. Additionally, perpetual futures contracts often have lower fees compared to traditional futures contracts, making them more cost-effective for traders. However, it's important to carefully manage leverage when trading perpetual futures contracts, as excessive leverage can lead to significant losses. In summary, perpetual futures contracts are the preferred choice for cryptocurrency traders due to their flexibility and cost-effectiveness.
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• TJSDec 21, 2021 · 4 years ago
  In the cryptocurrency trading space, perpetual futures contracts are the more commonly used type of contract. These contracts have gained popularity due to their unique features. Unlike traditional futures contracts, perpetual futures contracts do not have an expiration date, allowing traders to hold positions indefinitely. This eliminates the need for traders to constantly roll over their positions, saving time and effort. Additionally, perpetual futures contracts often have lower fees and more competitive funding rates compared to traditional futures contracts. However, it's important to note that perpetual futures contracts also carry the risk of liquidation if the position moves against the trader. Therefore, it's crucial for traders to carefully manage their risk and leverage when trading perpetual futures contracts. Overall, perpetual futures contracts are favored by cryptocurrency traders for their flexibility, cost-effectiveness, and ease of use.
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