Binance announced the launch of perpetual futures contracts on bitcoin with leverage up to 125x.
These are bitcoin-margined perpetual futures, and complement the range of derivatives available on Binance Futures with the aim of offering users greater diversification.
The first perpetual futures contract launched by the exchange almost a year ago was denominated in USDT, and today holds the largest trading volume, with an average monthly market share of 37%.
The new perpetual contract, in bitcoin, is the platform’s second futures line to be margined and priced using a cryptocurrency.
There are now quarterly and perpetual COIN margin futures contracts, also leveraged up to 125x, alongside those with USDT margin.
In addition, Binance Futures allows users to offset their margin for these two product lines.
The VP of Binance Futures, Aaron Gong, said:
“We are the only exchange that offers users flexible control of their margin balance by either spreading it across all their open positions or setting individual limits for each position they own (cross or isolate margin modes), as well as the ability to switch their margin modes at any time. Our users can also choose to hold one direction (i.e. long or short) or both directions at the same time for hedging”.
The founder and CEO of Binance, Changpeng CZ Zhao, commented:
“As Binance Futures approaches its one-year anniversary, we are encouraged by our users’ response to our platform and products. Shortly after hitting an all-time-high of $13 billion in daily futures volume last month, we crossed the $1 billion mark in open interest last week. Our growth has been steady no matter the market conditions, and that is testament to our users’ trust in us. We will continue to return their trust by building the ecosystem’s most innovative and user-centric products”.
What are futures contracts
COIN futures contracts, or “reverse” margin contracts, are popular in the crypto industry because for users who have short positions, even if the price rises, the margin still increases.
Also, they are less likely to reach the settlement price and can maintain their trading position for longer.
This is achieved by setting the cryptocurrency as the main currency of the contract, USD or USDT as the secondary currency, which allows viewing cryptocurrencies as commodities. Hence the definition of these contracts being “reverse margin”.