Crypto Futures Positions, Margin Types, and Leverage Basics
Summary
This guide explains basic crypto derivatives trading through futures, including perpetual and expiry contracts. It distinguishes long and short exposure and shows how buy and sell actions open or close each position. It also outlines order-entry concepts such as contract amount, leverage, and margin mode, though some fields are named without further explanation.
The document compares USDT-margined contracts, where collateral and profit or loss are denominated in USDT, with crypto-margined reverse contracts, which use the underlying cryptocurrency. It notes that leverage amplifies both potential gains and losses and that insufficient account balance can prevent an order. The material is introductory: it does not explain liquidation, funding rates, contract pricing, or how to manage the risks of leveraged positions.
Key ideas
- Buying opens a long position and selling opens a short position; closing actions reverse those trades.
- Crypto futures may be perpetual or have an expiry date.
- USDT-margined and crypto-margined contracts use different collateral and profit-and-loss currencies.
- Higher leverage increases both possible returns and risk.
- An order may be rejected when the account lacks sufficient collateral.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.