# How Are Crypto Futures Contracts Typically Settled? ⎊ Path

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

---

## How Are Crypto Futures Contracts Typically Settled?

Crypto futures contracts are predominantly settled in cash, meaning the difference between the contract price and the settlement price is exchanged in fiat or stablecoins, rather than physical delivery of the underlying cryptocurrency. Some platforms offer physical settlement, but cash settlement is more common, especially for perpetual futures.

- [Which Major Exchange Is Known for Offering Physically-Settled Bitcoin Futures?](https://learn.greeks.live/path/which-major-exchange-is-known-for-offering-physically-settled-bitcoin-futures/)

- [Can a Crypto Futures Contract Be Settled Physically?](https://learn.greeks.live/path/can-a-crypto-futures-contract-be-settled-physically/)

- [How Often Is the Funding Rate Typically Calculated and Exchanged on Major Crypto Exchanges?](https://learn.greeks.live/path/how-often-is-the-funding-rate-typically-calculated-and-exchanged-on-major-crypto-exchanges/)

- [Why Do Market Makers Prefer to Trade at the Bid or Ask Rather than the Mid-Price?](https://learn.greeks.live/path/why-do-market-makers-prefer-to-trade-at-the-bid-or-ask-rather-than-the-mid-price/)

- [Why Is Variation Margin Not Typically Required for Physically-Settled Futures Contracts?](https://learn.greeks.live/path/why-is-variation-margin-not-typically-required-for-physically-settled-futures-contracts/)

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

- [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/)

- [Explain the Difference between Physically-Settled and Cash-Settled Futures Contracts](https://learn.greeks.live/path/explain-the-difference-between-physically-settled-and-cash-settled-futures-contracts/)

## Glossar

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

Price ⎊ The settlement price, within cryptocurrency derivatives, options trading, and broader financial derivatives contexts, represents the final agreed-upon value at which a contract expires or is otherwise terminated.

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

Delivery ⎊ Physical Delivery in a derivative contract signifies the actual transfer of the underlying crypto asset from the seller to the buyer upon exercise or settlement, as opposed to a cash-settled exchange of net differences.

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

Settlement ⎊ Cash settlement, within cryptocurrency derivatives and options trading, represents the fulfillment of a contract obligation through a monetary exchange rather than physical delivery of the underlying asset.

### [Contract Price](https://learn.greeks.live/area/contract-price/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Definition ⎊ Contract price refers to the agreed-upon price at which a derivative contract, such as an option or future, is bought or sold.

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

Margin ⎊ requirements for leveraged positions are dynamically calculated based on the volatility of the underlying cryptocurrency and the current leverage ratio utilized by the trader on the centralized or decentralized exchange.

### [Liquidity](https://learn.greeks.live/area/liquidity/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Trading Capacity ⎊ Liquidity describes the ease with which an asset can be bought or sold in large quantities without substantially affecting its market price, measured by volume, bid-ask spread, and order book depth.

## Discover More

### [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.

### [Why Are Bitcoin Futures on Some Exchanges Physically Settled While Others Are Cash-Settled?](https://learn.greeks.live/path/why-are-bitcoin-futures-on-some-exchanges-physically-settled-while-others-are-cash-settled/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![Why Are Bitcoin Futures on Some Exchanges Physically Settled While Others Are Cash-Settled?](https://learn.greeks.live/wp-content/uploads/2025/10/Asymmetric-Cross-of-Mint-Green-and-Beige-Clock-Hands-Over-Abstract-Dark-Cyan-Quadrants.webp)

Reflects target audience (institutional vs. retail) and the specific regulatory environment of the exchange.

### [What Is the Primary Difference between a Physically-Settled and a Cash-Settled Futures Contract?](https://learn.greeks.live/path/what-is-the-primary-difference-between-a-physically-settled-and-a-cash-settled-futures-contract/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is the Primary Difference between a Physically-Settled and a Cash-Settled Futures Contract?](https://learn.greeks.live/wp-content/uploads/2025/10/Symmetric-Dualistic-Volatility-Surface-Representation-in-Decentralized-Finance-Derivatives-Protocol-Architecture.webp)

Physically-settled requires asset delivery; cash-settled pays the price difference in currency.

### [Can a Cash-Settled Futures Contract Still Be Used for Hedging Purposes?](https://learn.greeks.live/path/can-a-cash-settled-futures-contract-still-be-used-for-hedging-purposes/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![Can a Cash-Settled Futures Contract Still Be Used for Hedging Purposes?](https://learn.greeks.live/wp-content/uploads/2025/10/Precision-Machined-Substrate-Interfaces-for-Decentralized-Finance-Option-Primitives-Execution.webp)

Yes, by financially offsetting price risk without physical delivery, they maintain the core function of hedging.

### [How Do Options Contracts Differ from Futures Contracts?](https://learn.greeks.live/path/how-do-options-contracts-differ-from-futures-contracts/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Do Options Contracts Differ from Futures Contracts?](https://learn.greeks.live/wp-content/uploads/2025/10/Abstract-Modeling-of-Decentralized-Exchange-Liquidity-Pool-Mechanisms-and-Option-Strike-Price-Configurations.webp)

Options grant a right, futures impose an obligation, both to trade an asset at a set price.

### [What Is the Main Reason Options on Stock Indices Are Typically Cash-Settled?](https://learn.greeks.live/path/what-is-the-main-reason-options-on-stock-indices-are-typically-cash-settled/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is the Main Reason Options on Stock Indices Are Typically Cash-Settled?](https://learn.greeks.live/wp-content/uploads/2025/10/Tangible-Manifestation-of-Tokenized-Asset-Allocation-Within-High-Frequency-Trading-Architecture.webp)

The underlying asset is an abstract index number, making physical delivery of its component stocks impractical and complex.

### [What Is the Settlement Currency Typically Used in Crypto Futures?](https://learn.greeks.live/path/what-is-the-settlement-currency-typically-used-in-crypto-futures/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is the Settlement Currency Typically Used in Crypto Futures?](https://learn.greeks.live/wp-content/uploads/2025/10/Layered-Synthetic-Material-Geometry-Suggesting-Collapsed-Volatility-Surface-In-Decentralized-Derivatives-Protocols.webp)

Stablecoins (USD-margined/linear) or the base cryptocurrency (coin-margined/inverse).

### [Name a Major Exchange That Offers Cash-Settled Bitcoin Futures](https://learn.greeks.live/path/name-a-major-exchange-that-offers-cash-settled-bitcoin-futures/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![Name a Major Exchange That Offers Cash-Settled Bitcoin Futures](https://learn.greeks.live/wp-content/uploads/2025/10/Dual-Hypergeometric-Distribution-Engines-Mirroring-Decoupled-Perpetual-Futures-Settlement-Mechanisms.webp)

The Chicago Mercantile Exchange (CME) offers highly-used, regulated, cash-settled Bitcoin futures.

### [How Are Crypto Options Contracts Typically Collateralized?](https://learn.greeks.live/path/how-are-crypto-options-contracts-typically-collateralized/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Are Crypto Options Contracts Typically Collateralized?](https://learn.greeks.live/wp-content/uploads/2025/10/Cryptographic-Hedging-Mechanism-Interlocking-Futures-Contracts-Geometric-Convergence-Visualization.webp)

Options are secured by collateral; sellers must deposit the underlying crypto (for calls) or stablecoins (for puts) to cover the trade.

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**Original URL:** https://learn.greeks.live/learn/how-are-crypto-futures-contracts-typically-settled/
