Perpetual futures

Perpetual futures are a type of trading contract used in the world of cryptocurrency trading.

The purpose of a trading contract is to allow traders to speculate on the price movements of a particular cryptocurrency without actually having to own the underlying asset.

Perpetual futures are also designed to maintain a price that is closely tied to spot price of the underlying asset. To do this, the contract includes a mechanism known as a funding rate, which is periodically charged to traders holding long positions and paid to traders holding short positions. This funding rate helps ensure that the price of the perpetual futures contract remains in line with the price of the underlying asset.

Perpetual futures can be a useful tool for traders looking to speculate on the price movements of cryptocurrencies without actually owning the underlying assets.