What are crypto derivatives?

Like stock options or commodity futures contracts, crypto derivatives offer protection against volatility and adverse price movements on cryptocurrencies. A crypto derivative is also a proxy tool for investors to speculate on the future prices of cryptocurrencies. 1. Crypto Futures and Perpetual Swaps

What are the benefits of using derivatives in the crypto space?

The use of derivatives will ensure that traders who previously were at the mercy of price fluctuations will now be able to protect themselves from any risk that might stem from such occurrence. The use of derivatives in the crypto space is not regulated, and this alone portends risks.

What are the best crypto exchanges for derivative trading?

Some of the exchanges that have become a favorite for derivative trading are BitMEX, Deribit, and BaseFEX. There’s one thing to take note of, and that is, derivative trading on crypto exchanges are yet to be regulated. Therefore, anyone making use of this method ought to be ready for any eventuality, be it positive or negative.

What is derivatives trading?

Generally, derivatives trading refers to a mechanism under which traders sign a contract to trade an underlying asset at a specific date and price. The primary intent behind derivatives trading is to speculate on the underlying asset’s future price, allowing traders to book profits based on the price difference.