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

The main difference is the expiration date. A traditional futures contract has a fixed, predetermined expiration date, requiring traders to either close or 'roll over' their position before settlement.

A perpetual futures contract, or perpetual swap, has no expiration date, allowing a position to be held indefinitely. The perpetual contract uses a funding rate mechanism to keep its price aligned with the spot price, which is not required for traditional, time-limited futures.