Crypto

Perpetual futures

Also calledperpetual contract · perpetual swap · perps

Perpetual futures are derivative contracts that provide long or short price exposure to an underlying asset without a preset expiration date. They use margin, mark-price and liquidation rules, and usually periodic funding payments to help keep the contract price near the underlying spot price.

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What this page checked.

Sources
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Record updated
August 18, 2026

Perpetual futures — definition, practical meaning, example, and common interpretation risk checked against the linked reference material

Definition checked

  • Definition and plain-English explanation for “Perpetual futures”
  • The worked example and the distinction described in the watch-out note
  • Reference material: BitMEX — Perpetual Contracts Guide, CFTC — Futures Market Basics

Use the term correctly

  • Read the connected terms when a definition depends on another market concept
  • Check the broker’s contract specification when applying the term to a particular product
  • Treat examples as explanations of mechanics, not as prices, forecasts, or trading advice

Method. Editorial desk review of the definition, example, related concepts, and 2 linked sources. Calculations are checked directly where the entry contains arithmetic

Research scope and limits +
  • This glossary entry explains terminology and does not test a broker, trading account, platform, or live market condition
  • Contract wording and practical treatment can differ across brokers, venues, jurisdictions, and products
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  1. Added named authorship, a definition evidence record, application checks, and a concise scope disclosure

What Perpetual futures means

Unlike a dated futures contract, a perpetual futures position does not reach a normal expiry date. It can remain open while the trader meets the platform’s margin requirements, but it may be closed voluntarily, liquidated, or subject to the contract’s exceptional settlement rules. The trader generally does not receive the underlying cryptocurrency merely by holding the contract.

Perpetual futures can create exposure larger than the collateral posted, so gains and losses can move quickly. Funding, trading fees, the mark-price methodology, maintenance margin, and liquidation engine affect outcomes separately from the underlying asset’s spot-price movement. Contract terms vary materially by exchange and instrument.

Assume a trader opens a $10,000 long perpetual position using $1,000 of margin, a simplified 10× exposure. If the contract’s marked value falls 5%, the position loses about $500 before trading fees and funding. That is a 50% loss relative to the $1,000 margin, and further losses could trigger liquidation under the venue’s rules.

Common questions

Why are perpetual futures called futures if they do not expire?+

They are futures-like derivatives because they create contractual price exposure rather than immediate ownership of the underlying asset. Their defining difference from standard futures is that they have no ordinary fixed expiry and use funding to support price alignment.

Do perpetual futures always settle in cryptocurrency?+

No. Contracts can be settled or margined in crypto, stablecoins, or another specified asset. The contract specification determines the collateral asset, quote currency, contract size, mark price, and settlement or closeout arrangements.

Go to the original material.

01BitMEX — Perpetual Contracts Guide02CFTC — Futures Market Basics