US Perpetual Futures 101

US Perpetual Futures are no expiry futures contracts that closely track the underlying asset’s spot price. 

These contracts trade 24/7 and bring the core benefits of international perpetual futures to a US-regulated environment.

Background 

International perpetual futures allow traders to speculate on the price of an asset without an expiration date, while closely tracking the asset’s spot price. 

Perpetual futures represent more than 90% of global crypto derivatives volume. Major exchanges operating outside of the US have consistently reported daily trading volumes exceeding $50 billion for perpetual futures. 

Demand for this product in the US is strong. US Perpetual Futures eliminate the need for offshore workarounds, offering traders a domestic, regulated product with the same utility.

US Perpetual Futures are designed as no expiry contracts with 24/7 trading. 

The contracts incorporate a funding rate mechanism to keep futures prices closely aligned with underlying spot markets:

• Funding accrues hourly and is settled twice daily during designated cash adjustment periods.

• At each settlement period, accrued funding is aggregated and credited or debited to traders' accounts. 

• These mechanics enable a spot-like trading experience with the advantages of leveraged futures tax treatment. 

US Perpetual Futures have set contract sizes. For example, each nano Bitcoin Perpetual Futures contract represents 1/100th of a Bitcoin. 

This differs from international perpetual futures, where investors can enter positions for any amount above the minimum - there are no set contract sizes. 

US Perpetual Futures additionally offer up to 10x intraday leverage, enabling traders to amplify their exposure with limited capital. 

In traditional futures markets, contracts have monthly or quarterly expirations. Traders must either close their position or roll it into a new contract before it expires. 

This creates operational complexity, especially for longer-term strategies. US Perpetual Futures have no expiration, making it easier for traders to hold positions without needing to roll.

US Perpetual Futures additionally offer traders a way to track price movements 24/7 by closely mirroring spot prices through a funding rate mechanism. 

Traditional futures contracts have forward looking prices that may deviate from spot prices. 

By combining no expiration with a funding mechanism, US Perpetual Futures offer a "spot-like" trading experience while retaining all the features traders expect from derivatives—such as leverage and risk management.

An investor enters a long position in 1 nano Bitcoin Perpetual Future (BIP) at a price of $100,000 at 1:30 PM ET. The trader holds the contract through the 2:00 PM ET funding period and sells it at a price of $101,000 at 2:30 PM ET. 

At the 2:00 PM ET funding period, the funding rate for the hour is +0.010% and the mark price for the hour is $100,000. A funding debit of $1.00 (1 contract × 0.01 contract size × $100,000 mark price × 0.010% funding rate) is accrued for this hour.

At the end of day, the final funding debit or credit is calculated using the latest mark price, and all accrued funding payments are processed.

Investors can trade our US Perpetual Futures on our partner platforms now.

Key terms

US Perpetual Future

A no expiry ontract offered by Coinbase Derivatives that closely tracks the underlying asset’s spot price.

Funding rate

A periodic payment between long and short positions designed to keep futures prices aligned with spot markets.

Leverage

The ability to control a large position with a relatively small amount of capital (margin).

Margin

The deposit required to open and maintain a position in a futures contract.

Mark price

A calculated reference price that represents the estimated fair value of a futures contract.