Crypto Delivery Contracts: Settlement, Hedging, and Basis Arbitrage
Summary
The article explains dated crypto futures, contrasting them with perpetual contracts that have no expiration and commonly involve recurring funding payments. Delivery contracts expire and settle at a specified time, usually in cash in crypto markets. The article presents them as tools for taking price exposure without owning the asset, hedging, and observing market expectations for a future date. It also outlines a basic spot-and-futures arbitrage: buy spot and sell a delivery contract when the contract is priced above spot, with the reverse direction suggested when it is below spot.
The text describes one exchange’s quarterly contracts, margin choices, fees, settlement timing, mark-price calculation, and restrictions around settlement. These details are product-specific and may change. Its comparison of costs and claims about risk protection are not supported by quantitative evidence; settlement, basis, liquidity, and liquidation risks are not analyzed in depth. The article is an introductory product explanation, not a tested strategy or complete risk guide.
Key ideas
- Delivery contracts expire on a set date, while perpetual contracts do not.
- The article describes delivery contracts as a way to hedge or gain price exposure without owning crypto.
- A spot-and-delivery-contract position can seek to exploit a difference between their prices.
- The described quarterly schedule, margin assets, fees, and settlement rules are exchange-specific.
- The document provides no backtest or quantitative comparison of strategy performance.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.