# Can a Perpetual Swap Be Physically Settled with Crypto? ⎊ Path

**Published:** 2025-12-04
**Author:** Greeks.live
**Categories:** Path

---

## Can a Perpetual Swap Be Physically Settled with Crypto?

No, perpetual swaps are designed to be cash-settled. They are derivative contracts that track the price of the underlying cryptocurrency, and their value is exchanged in a stablecoin or fiat currency, not the actual crypto asset.

This allows for easier trading and avoids the logistical complexity and security risks associated with the transfer of the physical crypto asset.

- [How Does the Settlement Process for a Crypto Futures Contract Differ from a Traditional Commodity Future?](https://learn.greeks.live/path/how-does-the-settlement-process-for-a-crypto-futures-contract-differ-from-a-traditional-commodity-future/)

- [What Is the Primary Difference between Cash-Settled and Physically-Settled Crypto Futures?](https://learn.greeks.live/path/what-is-the-primary-difference-between-cash-settled-and-physically-settled-crypto-futures/)

- [How Does the Settlement Process Differ between Cash-Settled and Physically-Settled Futures?](https://learn.greeks.live/path/how-does-the-settlement-process-differ-between-cash-settled-and-physically-settled-futures/)

- [What Is the Difference between Physical and Cash Settlement in Tokenized Derivatives?](https://learn.greeks.live/path/what-is-the-difference-between-physical-and-cash-settlement-in-tokenized-derivatives/)

- [How Does a Clearing House Handle Settlement for Physically-Delivered Vs. Cash-Settled Futures?](https://learn.greeks.live/path/how-does-a-clearing-house-handle-settlement-for-physically-delivered-vs-cash-settled-futures/)

- [What Is the Difference between Physical Settlement and Cash Settlement for a Bitcoin Option?](https://learn.greeks.live/path/what-is-the-difference-between-physical-settlement-and-cash-settlement-for-a-bitcoin-option/)

- [How Do Cross-Currency Swaps in Traditional Finance Relate to Crypto Token Pairs?](https://learn.greeks.live/path/how-do-cross-currency-swaps-in-traditional-finance-relate-to-crypto-token-pairs/)

- [What Is the Primary Difference between Cash-Settled and Physically-Settled Futures?](https://learn.greeks.live/path/what-is-the-primary-difference-between-cash-settled-and-physically-settled-futures/)

## Glossar

### [Perpetual Swaps](https://learn.greeks.live/area/perpetual-swaps/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Derivatives ⎊ Perpetual swaps represent a class of financial derivatives, specifically within the cryptocurrency ecosystem, that replicate the payoff of a futures contract without a fixed expiration date.

### [Physical Settlement](https://learn.greeks.live/area/physical-settlement/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Delivery ⎊ The concept of physical settlement, particularly within cryptocurrency derivatives and options, signifies the actual transfer of the underlying asset ⎊ be it a digital token or a commodity ⎊ rather than a cash-based offset.

### [Derivative Contracts](https://learn.greeks.live/area/derivative-contracts/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Stewardship ⎊ Involves structuring these agreements to manage the financial exposure associated with assets that may face future regulatory or environmental shifts.

### [Logistical Complexity](https://learn.greeks.live/area/logistical-complexity/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Interdependence ⎊ Logistical complexity within cryptocurrency, options trading, and financial derivatives arises from the interconnectedness of market participants and systems, demanding robust risk management frameworks.

### [Physically Settled](https://learn.greeks.live/area/physically-settled/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Settlement ⎊ Physically settled derivatives contracts require the actual transfer of the underlying asset from the short position holder to the long position holder at maturity.

### [Perpetual Swap](https://learn.greeks.live/area/perpetual-swap/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Mechanism ⎊ Perpetual swaps, within cryptocurrency markets, represent agreements to exchange cash flows based on the difference between a cryptocurrency’s current price and a user-defined price, perpetually, without an expiration date.

## Discover More

### [What Is the Primary Difference between Cash-Settled and Physically-Settled Futures?](https://learn.greeks.live/path/what-is-the-primary-difference-between-cash-settled-and-physically-settled-futures/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is the Primary Difference between Cash-Settled and Physically-Settled Futures?](https://learn.greeks.live/wp-content/uploads/2025/10/Decentralized-Autonomous-Organization-Governance-Mechanism-Propelling-Volatility-Hedging-Instruments-Above-Stratosphere.webp)

Cash-settled exchanges the price difference in cash; physically-settled requires the actual delivery of the underlying asset.

### [How Does the Settlement Process Differ between Physically-Settled and Cash-Settled Derivatives?](https://learn.greeks.live/path/how-does-the-settlement-process-differ-between-physically-settled-and-cash-settled-derivatives/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Does the Settlement Process Differ between Physically-Settled and Cash-Settled Derivatives?](https://learn.greeks.live/wp-content/uploads/2025/10/Quantum-Entanglement-Mechanism-Within-A-Hardware-Wallet-Securing-Digital-Asset-Derivatives-Contracts.webp)

Physical settlement involves asset delivery; cash settlement involves a cash payment of the difference in price.

### [How Is the Premium Typically Settled in a Crypto Options Trade?](https://learn.greeks.live/path/how-is-the-premium-typically-settled-in-a-crypto-options-trade/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Is the Premium Typically Settled in a Crypto Options Trade?](https://learn.greeks.live/wp-content/uploads/2025/10/Conceptual-Modeling-of-High-Frequency-Algorithmic-Trading-Microstructures-Within-Digital-Asset-Derivatives-Exchange.webp)

The premium is usually settled upfront in the underlying crypto or a stablecoin when the contract is initiated.

### [How Is a Physically-Settled Commodity Future Taxed If It Is a Section 1256 Contract?](https://learn.greeks.live/path/how-is-a-physically-settled-commodity-future-taxed-if-it-is-a-section-1256-contract/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Is a Physically-Settled Commodity Future Taxed If It Is a Section 1256 Contract?](https://learn.greeks.live/wp-content/uploads/2025/10/Crystalline-Bifurcation-Matrix-Representing-Cryptocurrency-Volatility-Skew-and-Options-Contract-Settlement-Projections.webp)

Physically-settled 1256 futures use 60/40 and mark-to-market; delivery is non-taxable, but the commodity's basis is adjusted.

### [Do Physically-Settled Contracts Exist for Tokens Other than Bitcoin and Ethereum?](https://learn.greeks.live/path/do-physically-settled-contracts-exist-for-tokens-other-than-bitcoin-and-ethereum/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![Do Physically-Settled Contracts Exist for Tokens Other than Bitcoin and Ethereum?](https://learn.greeks.live/wp-content/uploads/2025/10/Liquidity-Pool-Dynamics-Visualization-Contrasting-Dark-Pool-Aggregation-with-Decentralized-Exchange-Spreads.webp)

Yes, for a limited number of major, highly-liquid altcoins, but they are less common than cash-settled contracts.

### [What Is the Difference between a 'Swap' and a 'Future' in Crypto Trading?](https://learn.greeks.live/path/what-is-the-difference-between-a-swap-and-a-future-in-crypto-trading/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is the Difference between a 'Swap' and a 'Future' in Crypto Trading?](https://learn.greeks.live/wp-content/uploads/2025/10/Macro-View-of-Centralized-Exchange-Lens-Reflecting-Multi-Asset-Volatility-Surface-Dynamics.webp)

A swap is an agreement to exchange cash flows (often no expiry); a future is a standardized contract for a transaction on a specific future date.

### [How Does an Atomic Swap Differ from Using a Centralized Crypto Bridge Service?](https://learn.greeks.live/path/how-does-an-atomic-swap-differ-from-using-a-centralized-crypto-bridge-service/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Does an Atomic Swap Differ from Using a Centralized Crypto Bridge Service?](https://learn.greeks.live/wp-content/uploads/2025/10/Decentralized-Finance-Mechanism-Representing-Atomic-Swap-Liquidity-Pool-Convergence-Under-Quantum-Entanglement.webp)

Atomic swaps are trustless P2P; centralized bridges require trusting a custodian to lock and mint assets.

### [What Is the Main Source of Basis Risk in Physically-Settled Agricultural Futures?](https://learn.greeks.live/path/what-is-the-main-source-of-basis-risk-in-physically-settled-agricultural-futures/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is the Main Source of Basis Risk in Physically-Settled Agricultural Futures?](https://learn.greeks.live/wp-content/uploads/2025/10/Symmetric-Aperture-Mechanism-Illustrating-Implied-Volatility-Surface-Dynamics-in-Decentralized-Finance.webp)

Location risk (distance from delivery point) and quality risk (difference from standard grade).

### [Give an Example of a Financial Derivative That Is Typically Physically Settled](https://learn.greeks.live/path/give-an-example-of-a-financial-derivative-that-is-typically-physically-settled/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![Give an Example of a Financial Derivative That Is Typically Physically Settled](https://learn.greeks.live/wp-content/uploads/2025/10/Reflective-Substrate-Interaction-with-Magnetic-Coil-Assembly-Simulating-Decentralized-Exchange-Liquidity-Pools.webp)

Traditional commodity futures, such as Crude Oil or Gold futures, often require the physical delivery of the asset.

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**Original URL:** https://learn.greeks.live/learn/can-a-perpetual-swap-be-physically-settled-with-crypto/
