Why Are Perpetual Futures Preferred over Traditional Futures Contracts in the Crypto Market?

Perpetual futures are preferred because they offer continuous trading without a fixed expiration date, removing the need for traders to roll over positions or worry about the convergence of the futures price to the spot price at expiration. The funding rate mechanism effectively manages the price basis.

This structure simplifies trading, reduces transaction costs associated with rollovers, and aligns with the 24/7 nature of the crypto market, offering greater flexibility and liquidity compared to traditional fixed-date futures.