1. What is Bitcoin Perpetual Contract
Bitcoin Perpetual Contract
Perpetual Contract is an innovative financial derivative , which is an upgrade on the basis of traditional futures contracts. Different from traditional futures contracts, which have a delivery date, the market is easy to be manipulated, and the market can be easily manipulated. There is no delivery date for perpetual contracts. It is a new type of digital currency derivatives. It is between traditional spot and futures contracts. Traders can buy long or sell short, which can well avoid contract to The risk of post-term swaps is a financial investment product that is extremely suitable for digital currency derivatives.
2. How to play BTC bitcoin futures contract, can you make money?
You can make money, but you may also lose money. The risk of the contract is still very high, at least It is more risky than normal currency speculation, but the benefits are also considerable. You can study and observe the exchange now, and then decide whether to enter the market.
3. What is Bitcoin Futures contracts
Bitcoin futures contracts are usually standardized contracts based on the Bitcoin price index.
Bitcoin futures offered by bitcoin exchanges are usually traded in bitcoin. Futures are relative to the spot, and the spot is a commodity that can be delivered with one hand and one hand, while futures are not actually “goods”, but an agreement (contract) that promises to deliver “goods” (subject) at a future time – futures contract .
Subject: Also known as the underlying asset, which explains what to buy or sell. At present, the underlying bitcoin futures are the bitcoin price index, and the methods of generating settlement and delivery prices are based on this index.
Fees: Unlike stock transactions, which are subject to stamp duties, commissions, transfer fees, and other fees, futures transactions are only charged a handling fee. There are two types of transaction fees for Bitcoin futures: opening and closing positions, which are charged when opening a position (such as OKCoin) and when closing a position (such as 796). Bitcoin futures fees are generally 0.03% of the total contract value.
Margin: Margin is closely related to another concept – leverage, which generally reflects the level of income and risk by leverage ratio. For example, the new 50 times leverage (ie 2% margin) introduced by 796 means that investors can buy 50 bitcoin futures contracts (ie 50 times leverage) by investing 1 bitcoin;
or From another perspective, 1 bitcoin invested by an investor is equivalent to 2% of the 50 bitcoins purchased (ie, 2% margin ratio).
Through 50 times leverage, the return of futures relative to spot is magnified by 50 times, such as buying 1 coin spot and buying 50 more coin futures with 1 coin at the same time, assuming spot and futures prices If both rise by 100%, then the spot earns 1 coin, and the futures earns 50 coins.
(3) What does Bitcoin contract long mean? Extended reading
A futures contract is one in which a buyer agrees to receive an asset at a specified price after a specified period of time, and a seller agrees to deliver an asset at a specified price after a specified period of time protocol. The price that both parties agree to use in future transactions is called the futures price.
The specified date on which future transactions must be entered into between the parties is called the settlement date or delivery date. The assets that both parties agree to exchange are called “underlyings”. If an investor takes a position in the market by buying a futures contract (that is, agreeing to buy at a future date), it is said to be a long position or a long position in futures.
On the contrary, if the investor’s position is to sell a futures contract (that is, to assume responsibility for the contract to be sold in the future), it is called a short position or a short position on futures.
4. What does Bitcoin contract trading mean
Contract trading is a general term for Bitcoin Litecoin futures contract trading.
In June 2013, 796 Exchange was the first in the bitcoin industry to develop bitcoin weekly delivery standard futures—T+0 two-way trading virtual commodities as collateral barter contracts (contract transactions).
The emergence of contract trading ended the previous history that Bitcoin could not be shorted, and opened the prelude to the development and prosperity of the Bitcoin derivatives market.
Reminder: The above information is for reference only and does not represent any advice.
Response time: 2020-12-16, please refer to the official website of Ping An Bank for the latest business changes.
[I know Ping An Bank] Want to know more? Come and see “I know Ping An Bank”~
5. What is Bitcoin contracts
Basics of Bitcoin contracts
Bitcoin contracts are contracts that can be traded without actually owning bitcoins. It is very different from currency-to-currency transactions, which must be physically held in digital currency.
Bitcoin contracts allow you to predict Bitcoin price movements and hedge risk. This way of trading means that you investIt’s the price trend, not the asset itself.
When trading Bitcoin contracts, you can decide to go short or long. Choosing to go long indicates that you expect the price of Bitcoin to rise. On the other hand, choosing to go short indicates that you expect the price to fall.
You can choose to trade with high leverage, which is a feature of Bitcoin contracts. Using leverage means that you do not have to invest 100% of the transaction amount when trading contracts. Instead, you only need to deposit an initial margin, which is only a fraction of the total contract value.
Leveraged trading allows you to have a large exposure with a small amount of money while managing risk.
Although there are many different types of contracts, this article focuses on perpetual contracts. As the name suggests, these contracts have no expiration date. Traders who use perpetual contracts to go long or short can hold their positions indefinitely, unless the contract is liquidated, which means they will not lose more than their initial margin.
In perpetual contracts, Bitcoin is priced based on a specific index price. Index prices are based on the average price of Bitcoin across multiple cryptocurrency exchanges.
Bitcoin contracts have become a very popular trading tool. Contract trading opens the door for many traditional investors who are not ready to allocate funds to digital assets but still want to benefit from attractive price volatility.
To open Bitcoin contract trading, you need to find an exchange that offers contract trading. The AAX platform, in a compliant and secure environment, provides you with bitcoin contract trading services.
6. What is the meaning of bitcoin contract trading and where to open it
It is the same as that of commodity futures contract trading. It is a transaction method that takes Bitcoin standardized contracts as the subject matter, and conducts collective auction transactions through electronic trading platforms to conduct unified transaction, transfer, and settlement, and real-time display of price quotations.
At present, bitcoin contract transactions can be bought and sold on many exchanges, and the contract value and rules are different. You need to choose the one that suits you according to your actual situation.
As for the question of where to open a contract transaction, you can open a contract transaction after you find a suitable exchange to open an account.
Let’s try to accept it, if you don’t understand, please ask.
7. What does shorting in bitcoin mean
Shoring refers to selling positions. Doing more: Doing refers to a long position, and it can also be called a bullish position, also known as a long position. Buy a certain type of currency, bearish.
1. Going long means that it is estimated that the potential will rise, so buy contracts, and sell contracts at sky-high prices after the price rises in the future. Get a net profit. Going short means selling the contract after estimating that it is going to fall, and buying the contract at a low price when the price falls in the future. Get a net profit.
2. In terms of hedging: Doing more means evading or hedging away the risk of product cost expansion caused by future price increases, and locking in costs in advance. Shorting means escaping or hedging away the risk of profit reduction caused by future price drops, and locking in profits early.
(7) What does it mean to be long in a Bitcoin contract? Extended reading
Liquidation, under some special conditions, the investor’s margin account Situations where customer equity is negative. When the market situation changes greatly, if most of the funds in the investor’s margin account are occupied by the trading margin, and the trading direction is opposite to the market trend, due to the leverage effect of margin trading, it is easy to liquidate.
If the liquidation leads to a shortfall and is caused by the investor, the investor needs to make up the shortfall, otherwise he will face legal recourse. The greater the leverage, the closer it is to liquidation, and you must be cautious when adding any leverage.
8. The way to not lose money in bitcoin contracts
Any investment has both risks and benefits. If you don’t want the risk, there is no benefit.
9. What is a bitcoin contract transaction
1. Definition of a contract
A futures contract is a contract that the buyer agrees to receive at a specific price after a specified period of time An agreement in which the seller agrees to deliver an asset at a specified price after a specified period of time.
The price that both parties agree to use in future transactions is called the futures price. The specified date on which the two parties must transact in the future is called the settlement date or delivery date. The assets that both parties agree to exchange are called “underlyings”.
If an investor takes a position in the market by buying a futures contract (that is, agreeing to buy at a future date), it is called a long position or a long position in futures. Conversely, if an investor takes a position by selling a futures contract (that is, taking responsibility for the contract to be sold in the future), it is called a short position or short on futures.
2. The origin of the contract
A futures contract refers to the unified formulation by the futures exchange�, Standardized contracts that provide for the delivery of a certain quantity and quality of goods at a specific time and place in the future. It is the object of futures trading, and the participants of futures trading transfer price risk and obtain risk-return by buying and selling futures contracts on the futures exchange.
Futures contracts are developed on the basis of spot contracts and spot forward contracts, but the most essential difference between them is the standardization of the terms of futures contracts. For futures contracts traded in the futures market, the quantity, quality grade and delivery grade of the subject matter, as well as the premiums and discounts of substitutes, delivery location, delivery month and other terms are standardized, making futures contracts universal.
In the futures contract, only the futures price is the only variable, which is generated by open auction on the exchange.
3. Classification of contracts
Digital currency contracts can be divided into: delivery contracts and perpetual contracts.
(1) Delivery contract: Futures delivery refers to the process in which both parties to the transaction settle the expired open contracts through the transfer of the ownership of the commodities contained in the futures contract when the futures contract expires.
(2) Perpetual contract: It is a derivative product similar to leveraged spot trading, and is a digital currency contract product settled in BTC, USDT and other currencies. Investors can obtain the benefits of rising digital currency prices by buying long, or obtain benefits from falling digital currency prices by selling short.
Perpetual contracts differ from traditional futures in a certain way: they have no expiration time, so there is no limit to how long a position can be held. In order to ensure that the underlying price index is tracked, the perpetual contract ensures that its price closely follows the price of the underlying asset through the mechanism of funding fees.