How does perpetual work?

Unlike traditional futures contracts, perpetual contracts do not have a set expiration date. This feature allows them to remain open indefinitely, providing traders with the flexibility to hold their positions for as long as they wish.

The mechanism behind perpetual contracts' longevity lies in their settlement process. Every eight hours, perpetual contracts undergo a "settlement" where the contract's price is compared to the underlying spot price.

When the perpetual contract's price is higher than the spot price, this indicates that the long side of the contract has benefited from positive market movement. To maintain the contract's fairness, the long side pays a funding fee to the short side.

BTCC, a top cryptocurrency exchange, offers a range of services that cater to the needs of crypto traders. Among its offerings are perpetual contracts, along with spot trading, futures trading, and wallet services. With these diverse options, BTCC provides traders with a comprehensive platform for all their cryptocurrency trading needs.

Perpetual contracts are financial instruments designed to meet the needs of traders who seek continuous exposure to market trends.