A perpetual swap is a form of derivative instruments which means that traders can maintain leveraged positions in any time frame. Crypto perpetual swaps are just like regular perpetual swaps, but their underlying assets are cryptocurrencies.
What is Perpetual Swap in Bingbon?
Perpetual Swap is the most popular future contract product in the current digital asset derivatives market. Bingbon's Perpetual Swap is a perpetual contract with USDT as margin. It has no due date and never expires.
Features of Perpetual Swap
In recent years, Bingbon’s Perpetual Swap has become more and more popular with crypto futures investors. Part of the reason is that Perpetual Swap never delivers. It can improve the situation that investors have to close their positions first and then re-open due to the arrival of the contract delivery date. At the same time, it also solves the problem of missing market fluctuations caused by tedious operation procedures.
In summary, Bingbon Perpetual Swap has the following three characteristics:
- No delivery date
Bingbon’s Perpetual Swap is not limited to time, and there is no delivery date. Traders can hold for a long time to obtain greater investment income. The most important thing is that traders can buy bottoms with Perpetual Swap when prices are low, and there is a high probability that they can hold long-term positions, obtaining long-term returns.
- Always anchor the spot market price of digital assets
Bingbon’s Perpetual Swap uses the fund rates adjustment mechanism to anchor the price of the spot index price. The Bingbon contract index prices are taken from a weighted average of spot market prices on Huobi, Binance and OKEx. In this way, it is possible to prevent whale traders from maliciously manipulating market prices and causing common investors to suffer huge losses. Bingbon’s Perpetual Swap uses the "funding rate" mechanism to control the balance between long and short parties.
- Up to 100 times flexible and adjustable leveraged
The leverage multiple of digital asset delivery contracts is relatively low, while the leverage of Bingbon’s Perpetual Swap is much higher. There are different leverage multiples depending on the trading pairs. The BTC/USDT trading pair supports maximum leverage of 100 times.
Traders can flexibly adjust the leverage multiples after opening a position according to their needs to achieve the best trading experience. In addition, investors need to understand that leverage is determined by the initial margin and maintenance margin levels. These two determine the minimum fund required to open and maintain a position.
For more details: About Perpetual Swap Trading Pairs, Leverage and Limits
- Support two trading modes: cross margin mode and isolated margin mode
Bingbon Perpetual Swap can switch cross margin mode to isolated margin mode. In general, the cross-margin mode is suitable for hedging traders, while the isolated margin mode is more suitable for short-term investors to better implement risk control strategies. After holding a position, the user can control the position risk by adjusting the margin to meet your needs at any time.
For more details: Comparison of Cross Margin Mode and Isolated Margin Mode
Differences of Perpetual Swap
When using Bingbon Perpetual Swap, traders need to make sure they have a good understanding of the mechanics and features of Perpetual Swap. Pay attention to the following differences when trading.
- Margin: Perpetual Swaps currently support the use of USDT as margin; Standard Contracts include both USDT and Cryptocurrencies margined contracts.
- Order Type: Perpetual swaps support limit orders, market orders, and trigger orders; Standard Contracts do not support limit orders currently.
- Position: For perpetual swaps, multiple orders are combined into one "position" for unified management; For Standard Contracts, each order is managed independently, which is simpler and more intuitive for common users.
- Mark prices: Perpetual Swap uses mark prices to calculate the unrealized profit and loss, and mark prices use moving average prices to avoid market manipulation and allow Perpetual Swap index prices to be anchored close to spot prices.
- Trading fee rates: The current Taker fee rate of Perpetual Swap is 0.045%, and the Maker is 0.020%. The trading fee rate of the standard contract is currently 0.045%, and the trading fee rate of copying trade is 0.0375%. It is charged unilaterally, no trading fee is charged for opening a position, and only charged when the position is closed.
- Funding rate: Bingbon Perpetual Swap will charge funding fees to users who hold positions. Between buyers and sellers, regular payments are made every 8 hours. If the interest rate is positive, the long position will be paid, and the short position will receive the funding fee. If the interest rate is negative, the opposite is true. Please note that users only need to pay or receive funding fees when they hold positions at the three time points in one day. The fund rate for Perpetual Swap is calculated slightly differently from standard contracts, although they are negligible fees.
- Leverage: Perpetual Swap supports all leverage multiples within a certain range, currently 1-100x. Standard contracts can support leverage multiples such as 1-150x.
In short, investors with high sensitivity will intuitively feel that in addition to using small funds to leverage large returns, Bingbon’s Perpetual Swap does not need to consider cumbersome steps such as delivery and change of positions. Bingbon’s Perpetual Swap is the best way for experienced traders to earn much more from the crypto market than through regular trading.
Risk Warning: In the contract market, some of the underlying leverage ratios are high. While amplifying the value of the trader’s holdings, it also magnifies the trader’s position risk. Therefore, traders should pay attention to high risks and need to be cautious of using leverage.