Why Are Physically-Settled Bitcoin Futures Less Common than Cash-Settled Ones?
Physically-settled Bitcoin futures require the actual delivery and receipt of Bitcoin at expiration, which introduces complexities like secure digital asset custody, transfer logistics, and regulatory hurdles. Cash-settled futures, which simply pay out the difference in fiat currency or a stablecoin, are simpler, more liquid, and avoid the need for physical crypto transfer.
Most exchanges prefer the simpler cash settlement model for high-volume trading.