Future

In crypto markets, futures let traders take a position on where an asset's price is headed without ever holding the coin itself. Instead of buying Bitcoin on a spot market, a trader can open a futures position that pays out based on price movement alone, going long if they expect the price to rise or short if they expect it to fall.

Regulated exchanges such as CME list dated Bitcoin and Ether futures with fixed monthly expiries, cash-settled against a reference rate rather than requiring delivery of actual coins. These contracts, first launched for Bitcoin in December 2017, are widely used by institutions for hedging exposure and for price discovery, since the futures curve reflects traders' collective expectations about future prices.

Crypto exchanges also popularized a variant unique to this asset class: perpetual futures, which never expire. Because there is no settlement date to force the contract price back toward spot, perpetuals use a periodic funding payment between long and short holders to keep the two prices aligned.

Both types are typically traded with leverage, sometimes very high on crypto-native platforms, which magnifies gains but also losses. A losing position can be liquidated once posted margin falls below the exchange's maintenance threshold, so futures trading carries meaningfully more risk than simply holding the underlying asset.