Bitcoin futures offer protection against volatility and adverse price movements. Also, it is a proxy tool for traders to speculate on the future prices of Bitcoin. With a Bitcoin futures contract, you can take a long position if you expect the price of Bitcoin to rise. Conversely, you take a short position to reduce the impact of losses when the price of Bitcoin falls. When investing for the long-term, Bitcoin may experience occasional bear markets as sentiments change. In these uncertain periods, your Bitcoin portfolio is unlikely to gain very much, if any at all. In such scenarios, Bitcoin futures contracts can be useful to protect your Bitcoin investments against downside risk.
FAQs
Bitcoin Futures | Bitcoin Futures Prices | Bitcoin Futures Trading | Binance Futures? ›
Bitcoin futures contracts trade on the Chicago Mercantile Exchange (CME), which introduces new monthly contracts for cash settlement. The CME offers monthly BTC futures contracts for six months and additional quarterly contracts for each of the four upcoming quarters.
Can you trade BTC on futures? ›Bitcoin futures contracts trade on the Chicago Mercantile Exchange (CME), which introduces new monthly contracts for cash settlement. The CME offers monthly BTC futures contracts for six months and additional quarterly contracts for each of the four upcoming quarters.
How are Bitcoin futures priced? ›Determining the Price of Bitcoin Futures
Bitcoin futures prices depend on the currency's spot prices. This is the market's current price at which Bitcoin can be purchased or sold for immediate delivery.
The top metrics to look out for when trading crypto futures include option chain, open interest, put/call ratio, liquidation data, funding rate, and long vs short positions data.
What is the difference between Bitcoin and Bitcoin futures? ›Bitcoin is a large portion of the growing digital asset market. BTC futures provide investors with transparency, price discovery and risk management capabilities. The contract will also allow individual market participants to access the bitcoin market as well as hedge any direct exposure to bitcoin pricing.