Perpetual Trading
Perpetual trading, also referred to as perpetual swaps or perpetual contracts, is a derivative financial product that enables traders to speculate on the value of an underlying asset without a specified expiration date. While similar to futures contracts in some ways, these contracts lack a fixed expiry or settlement date. Instead, they are intended to be held indefinitely, with traders making regular payments to maintain their position.
This enables traders to capitalize on price fluctuations on an ongoing basis, rather than being restricted to the expiration of a traditional futures contract. Perpetual trading is frequently used in the cryptocurrency market, where decentralized exchanges (DEXs) often provide it as a means for traders to speculate on the value of a range of digital assets.
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