How does FTX perpetual futures differ from traditional futures contracts?

7 answers

• Connor DomanJan 19, 2025 · 6 months ago
  FTX perpetual futures and traditional futures contracts differ in several key ways. Firstly, FTX perpetual futures do not have an expiration date, unlike traditional futures contracts which have a set expiration date. This means that FTX perpetual futures can be held indefinitely, allowing traders to maintain their positions for as long as they want. Additionally, FTX perpetual futures use a funding rate mechanism to ensure that the price of the futures contract closely tracks the spot price of the underlying asset. This funding rate is periodically paid between long and short positions, which helps to prevent large price discrepancies between the futures contract and the spot market. Traditional futures contracts, on the other hand, may experience price deviations from the spot market due to factors such as time decay and market demand. Overall, FTX perpetual futures offer more flexibility and closely track the spot market, making them a popular choice among cryptocurrency traders.
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• kishoreDG19Jul 21, 2023 · 2 years ago
  The main difference between FTX perpetual futures and traditional futures contracts lies in their expiration dates. Traditional futures contracts have a fixed expiration date, which means that traders must close their positions before the contract expires or roll them over to a new contract. FTX perpetual futures, on the other hand, do not have an expiration date. This means that traders can hold their positions for as long as they want without worrying about contract expiration. Additionally, FTX perpetual futures use a funding mechanism to ensure that the price of the futures contract closely tracks the spot price of the underlying asset. This funding mechanism helps to prevent large price discrepancies between the futures contract and the spot market, providing traders with a more accurate representation of the asset's value.
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• Poorani AyswariyaMay 18, 2024 · a year ago
  FTX perpetual futures differ from traditional futures contracts in a few key ways. Firstly, FTX perpetual futures do not have an expiration date, allowing traders to hold their positions indefinitely. This is in contrast to traditional futures contracts, which have a fixed expiration date and require traders to close their positions before the contract expires. Additionally, FTX perpetual futures use a funding rate mechanism to ensure that the price of the futures contract closely tracks the spot price of the underlying asset. This funding rate is periodically paid between long and short positions, helping to maintain the correlation between the futures contract and the spot market. It's important to note that FTX is a popular cryptocurrency exchange that offers perpetual futures contracts, among other trading products.
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• Rafael EdoraJan 01, 2023 · 3 years ago
  FTX perpetual futures and traditional futures contracts have some notable differences. One key difference is that FTX perpetual futures do not have an expiration date, while traditional futures contracts have a fixed expiration date. This means that FTX perpetual futures can be held indefinitely, providing traders with more flexibility in managing their positions. Additionally, FTX perpetual futures use a funding rate mechanism to ensure that the price of the futures contract closely tracks the spot price of the underlying asset. This funding rate is periodically exchanged between long and short positions, helping to maintain the fair value of the futures contract. In contrast, traditional futures contracts may deviate from the spot market due to factors such as time decay and market demand. Overall, FTX perpetual futures offer a more flexible and accurate trading experience compared to traditional futures contracts.
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• Queen AldayFeb 12, 2023 · 2 years ago
  FTX perpetual futures and traditional futures contracts have some key differences. One major difference is that FTX perpetual futures do not have an expiration date, allowing traders to hold their positions for as long as they want. Traditional futures contracts, on the other hand, have a fixed expiration date, requiring traders to close their positions before the contract expires. Additionally, FTX perpetual futures use a funding rate mechanism to ensure that the price of the futures contract closely tracks the spot price of the underlying asset. This funding rate is periodically exchanged between long and short positions, helping to maintain the price stability of the futures contract. In contrast, traditional futures contracts may experience price deviations from the spot market due to factors such as time decay and market demand. Overall, FTX perpetual futures offer more flexibility and price accuracy compared to traditional futures contracts.
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• PisitSep 01, 2023 · 2 years ago
  FTX perpetual futures and traditional futures contracts have some distinct differences. One key difference is that FTX perpetual futures do not have an expiration date, allowing traders to hold their positions indefinitely. This is different from traditional futures contracts, which have a fixed expiration date and require traders to close their positions before the contract expires. Additionally, FTX perpetual futures use a funding rate mechanism to ensure that the price of the futures contract closely tracks the spot price of the underlying asset. This funding rate is periodically exchanged between long and short positions, helping to maintain the price equilibrium of the futures contract. Traditional futures contracts, on the other hand, may deviate from the spot market due to factors such as time decay and market demand. Overall, FTX perpetual futures provide traders with more flexibility and a closer alignment with the spot market.
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• J-wApr 15, 2024 · a year ago
  FTX perpetual futures and traditional futures contracts have some notable differences. One key difference is that FTX perpetual futures do not have an expiration date, allowing traders to hold their positions indefinitely. This is in contrast to traditional futures contracts, which have a fixed expiration date and require traders to close their positions before the contract expires. Additionally, FTX perpetual futures use a funding rate mechanism to ensure that the price of the futures contract closely tracks the spot price of the underlying asset. This funding rate is periodically exchanged between long and short positions, helping to maintain the price stability of the futures contract. Traditional futures contracts, on the other hand, may experience price deviations from the spot market due to factors such as time decay and market demand. Overall, FTX perpetual futures offer more flexibility and price accuracy compared to traditional futures contracts.
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