The Bitcoin Basics

    You are here:  
  1. Home
  2. Trading
  3. Cryptocurrency
  4. The Bitcoin Basics

Newsfeeds Categories View

Cryptocurrency

Explaining BitMex Perpetual Contracts and Crypto Funding Rate

A Perpetual Contract trades like a Futures Contract, but never settles and never expires.

What is a Bitmex Perpetual Contract? 

Bitmex Perpetual Contracts are derivatives similar to classic Futures Contracts. These contracts enable crypto traders to speculate on both directions of the price of a cryptocurrency asset. Compared to Futures Contracts we can spot these differences:

  • Perpetual Contracts don’t expire (there is no daily settlement)
  • The price of a Perpetual Contract trades significantly closer to the underlying Index Price compared to a similar Futures Contract
  • The primary price-spotting mechanism of a Perpetual is Funding. This mechanism allows the perpetual contract to be priced very close to the price of the spot market (explained briefly below)

What is a Perpetual Swap?

A Perpetual Contract trades like a Futures Contract, but never settles and never expires.Perpetual Swaps are derivatives offered by the OKex exchange and trade similarly to Bitmex Perpetual Contracts. Again, they are like Futures Contracts, but without expiries and daily settlements.

Cryptocurrency

BITCOIN MARKETS (CRYPTOCURRENCY EXCHANGES)

Cryptocurrency exchanges are common places to buy/sell Bitcoins and other digital coins.

Evaluating Cryptocurrency Exchanges

These are some key issues when choosing an exchange (every factor listed below is important):

BASIC CONCEPTS

  • Acceptance: -Does an exchange accept your country?
  • Verification: -What are the requirements for verifying? -What are the trading limits before/after verification?
  • Deposit/Withdrawal Methods: -What are the available fund methods (Cards, Online Wallets, etc.)?
  • Asset Index: -Which coins/tokens are available in the exchange?

SAFETY/RELIABILITY

  • Safety of money: -Where is the headquarters base? -How many years in the market?
  • Online security: -Are the cryptocurrencies of clients stored in cold storage, as they should? -In the case of P2P transactions, is there an Escrow Service?
  • Online reviews for this exchange: -What other people say about this exchange (Caution, 50% of all the reviews you read are fake)?

COMPETITIVENESS

  • Transaction cost: -What are the transaction fees?
  • Exchange rate: -What is the exchange rate for the crypto you need to buy? -What is the ask/bid spread?
  • Responsiveness of the Customer Service

  1. How to Trade Bitcoins

About TradingCenter

TradingCenter provides essential information and tools for learning and trading the Global Financial Markets. TradingCenter helps investors to improve their skills and their level of understanding regarding core mechanisms of the trading process.

© (2012-2021) TradingCenter.org by Qexpert.com

Search