Explain the Difference between "Spot" and "Perpetual" Contracts in Crypto Derivatives ▴ Learn

Explain the Difference between “Spot” and “Perpetual” Contracts in Crypto Derivatives.

A spot contract is a simple agreement to buy or sell the underlying asset immediately at the current market price. A perpetual contract is a type of futures contract that does not have an expiration date.

Unlike traditional futures, perpetuals use a "funding rate" mechanism to periodically ensure their price tracks the spot price. This mechanism makes perpetuals the most popular derivative product in crypto trading.

How Does a Futures Contract Differ from a Perpetual Swap in Terms of Margin Requirements?

What Is the Difference between a Perpetual Futures Contract and a Traditional Futures Contract?

What Is the Difference between a ‘Futures Contract’ and a ‘Perpetual Swap’?

What Is the Funding Rate in a Perpetual Futures Contract?