Explain How a Loyalty Token Can Be Used as the Underlying Asset for a Perpetual Futures Contract

A perpetual futures contract is a derivative that trades like a futures contract but has no expiration date. For a loyalty token, the perpetual future allows traders to speculate on its long-term price without holding the actual token.

The contract is kept close to the spot price through a 'funding rate' mechanism, which is paid between long and short positions. This creates a highly liquid, leveraged market for the token, even if the token itself is primarily used for utility.