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In recent years, there is a growing interest associated with Crypto Derivatives trading, especially after the launch of bitcoin futures trading by the Chicago Board Options Exchange (CBOE) and the Chicago Mercantile Exchange (CME) at the end of 2017. According to Cryptocurrency Derivatives Exchange Industry Report from blockchain research company Tokeninsight, in 2021 Q1, 17 out of all researched exchanges are conducting futures trading business with a quarterly total trading volume of $2.07 trillion, which account for 6.77% of the total market trading volume.
In this article, let us take a look at what Crypto Derivatives Perpetual Futures are and the benefit that is attracting more and more traders into this market.
What is Crypto Derivatives Trading?
Derivatives, by definition, are a contract that derives its value from the performance of an underlying entity which means it represents a contract of an asset or any financial instrument where the price and execution date is pre-decided between two parties. Crypto Derivatives Trading implies that two parties agree on a contract to speculate the price of a cryptocurrency on a pre-decided date in the future. The critical thing to remember is that crypto derivatives trading is not trading to gain profit but to mitigate risks against volatile assets. For example, traders can invest in some Bitcoin if they predict an increase of the Bitcoin price in the future or choose to sell them off if they foresee a fall of the Bitcoin's price.
Crypto Derivatives can be classified into five categories: swap, futures, forwards, options, and perpetual futures. MCS is an example of a Crypto Derivatives Perpetual Futures Platform.
Benefits of MCS Crypto Derivatives Perpetual
Maximize Trading Strategy
Traders can hold positions as long as they want without any pre-determined expiry dates. This allows traders to maximize their trading strategy based on the market movements. One of the most significant advantages of trading crypto derivatives is that traders can maximize their strategy using leverage. On the MCS platform, for example, traders can use up 150x leverage. This means that traders who own 1 BTC can open positions of 150 BTC and gain a more significant profit.
*Trading with leverage is a way to earn a significant return; however, it is highly risky. Before trading with leverage, MCS strongly recommends that traders fully understand the advantages and disadvantages of leveraged trading.
Traders who trade on the BTC/USDT Perpetual Contract on MCS can trade without having exposure to the fiat currency since perpetual contracts are 'inverse futures contracts'. All settlements are done in BTC and not fiat currency such as USD.
Furthermore, traders can also trade Quanto products on MCS. Quanto is a derivative instrument that is dominated by one currency but settled in either the base currency or the quote currency in the trading pair. When traders trade cryptocurrencies such as ETH or XRP and the prices of the cryptocurrencies rise, all the profits will be settled in Bitcoin. If the price of the Bitcoin increases at the time of the settlement, the increase will also become a part of your profits.
Simply put, MCS traders can benefits hugely, during both the Bitcoin bull and bear season. Aside from that, settlement in BTC enables the bypassing of some regulatory hurdles involving fiat deposits.
Since the settlement are done in BTC and not fiat currency, BTC transactions can take place from one wallet to another without any limitation of the geographical distances and each country's regulation on the deposit and withdrawal on the exchange. The transaction cost for the transaction could also cost less since there are no interbank and FX charges.
Trading perpetual contracts require an exchange to have a fast order matching and risk management. MCS is a reputable, stable, and secure cryptocurrency derivatives perpetual contract trading platform with more than ten inverse and Quanto perpetual products. All contract products on MCS use Bitcoin (BTC) as payment and settlement currency, and MCS proceeds the withdrawal requests in real-time for traders' convenience with low transaction fees.
Traders ALWAYS come first on MCS.