How Does the Settlement Process Differ between Physically-Settled and Cash-Settled Derivatives? ▴ Learn

How Does the Settlement Process Differ between Physically-Settled and Cash-Settled Derivatives?

Physically-settled derivatives require the actual delivery of the underlying asset upon expiration. For example, a physically-settled Bitcoin future requires the delivery of Bitcoin.

Cash-settled derivatives, however, are settled by paying the difference between the contract price and the market price in cash (or stablecoins), with no physical asset exchange.

Explain the Difference between Physically-Settled and Cash-Settled Futures Contracts

What Is the Key Difference between Cash-Settled and Physically-Settled Futures Contracts?

What Is the Difference between Cash-Settled and Physically-Settled Futures?

What Is the Primary Difference between Cash-Settled and Physically-Settled Futures Contracts?