What is Crypto Futures Trading?

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What is Crypto Futures Trading? If you are interested in futures trading, this article is for you; In the same article, we will tell you what futures trading is and how to do futures trading. As the name suggests, while predicting the futures at present of any coin, that is, if your experience or analysis says that a coin can be worth too much or less in the future, then based on your experience and research, you can trade in future while sitting the current date.

What is Crypto Futures Trading? If your analysis is correct, you can make money in futures trading, and if the price of the coin does not move according to your research, you can lose a significant amount, which is why there is much risk in futures trading. If your nervous system is robust, you can come into futures trading; if you can’t control your nervous system, then futures trading is not for you because it requires a lot of patience and courage. Two types of futures trading are more popular as follows.

1. Perpetual

2. Quarterly

Perpetual Future Trading

Whenever you put a trade on perpetual, there is no limit to it, and you can close it whenever you want; if you keep it open for a long time, then you also have the option; to make sure your account has a sufficient balance.

Quarterly Future Trading

And in quarterly trading, you are given a time limit that you will close this trade in a week, close in ten days, or close in fifteen days; for this, different exchanges give you different types of time frames as soon as that time is over, your trade is closed whether it is in profit or loss. So here we understood that the most significant difference between Perpetual and quarterly is the time limit.

Funding Rate

What is the funding rate or interest in futures trading? Whenever you take a trade, you are either buying it or selling it. Because when you take a trade in the future, according to your analysis, if the price rises, you will put a buy, and if the price is low, you will deal with sell. So if the market here goes against you and the price does not increase or decrease, your trade will start losing.

And if you don’t close the trade, the market buyers or sellers against your trade play an invaluable role in saving your trade and paying the funding rate to buyers or sellers by exchanges. When you put the future trade, you can also see the option of funding rate on all exchanges, and exchanges calculate it.

Leverage (10x, 20x, 50x ………..)

For Example, if you have 100 USDT, you can take a loan by an exchange with an interest of 10x, meaning ten times or 20x or 50x, and so on. Loans are available on exchanges, but other coins have different leverage rates. It would be best if you took your trade according to your given leverage by studying and visiting the exchange.

What is Crypto Futures Trading? Now, when you close the trade, whatever profit you get from it, you will get the same amount to you, and the payoff will be to your account. And whatever leverage is also taken back from you, and if your trade goes in loss, they charge your capital and borrowed amount from you and start deducting from it.

What is Crypto Futures Trading? If the trade has gone to your test, your account will be gradually reduced and washed away. It means that your entire amount will have vanished, which is why it is a very high risk.

Halal or Haram

Currently, there are about 2.5 billion Muslims worldwide, and it is the second biggest ratio of humans. The biggest concern among Muslims is taking an interest, which is Haram or Illegal in their religion.

What is Crypto Futures Trading? If you are a Muslim and want to avoid interest, then futures trading is not for you as it can make you many times more profitable and immediate loss on the spot. You go to the concept of halal and haram, and it is evident that it falls under the category of sin, and futures trading is not for Muslims at all.