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Author: Admin | 2025-04-28
From owning Bitcoin itself. Leverage allows traders to control a larger position than their initial capital. For example, with 10x leverage, a trader can control a $10,000 position with just $1,000. While this can amplify profits, it also increases the risk of significant losses, especially if the market moves against the position. Futures contracts have a set expiration date, meaning they will settle on a specific date. In contrast, perpetual contracts do not expire, allowing traders to hold positions indefinitely, provided they maintain the required margin. Perpetual contracts use a funding rate mechanism to keep their prices close to the spot market rate. The primary risks include high leverage, which can lead to rapid liquidation if the market moves unfavorably, and Bitcoin’s inherent volatility, which can cause sudden price swings. Additionally, perpetual contracts incur funding rates, which can accumulate over time and impact profitability. Yes, Bitcoin contract trading does not require owning Bitcoin. You are merely speculating on the price movement of Bitcoin. This allows traders to benefit from price fluctuations without the need to store or manage the actual cryptocurrency, making it a flexible option for those seeking exposure to Bitcoin’s market movements.
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