All futures trading platforms are subject to risks as cryptocurrency values fluctuate wildly. It is again this fluctuation in the value of a cryptocurrency that attracts individual traders and commercial organizations to take leverage with the hope of making a windfall profit. In a futures market, the investors buy and sell futures contracts in which the underlying principle is that one party agrees to buy a certain quantity of bitcoin futures or other currencies and the other agrees to deliver the same at a fixed date in the future. The risk comes due to the non-availability of physical assets or cryptocurrency. It therefore means that the value traded is mostly in the form of speculation about whether the prices of a cryptocurrency will hold or go up or down as the case may be. In such a scenario it is obvious that traders in crypto futures may suffer heavy losses or make huge profits as they are allowed to take leverage with the help of authorized trading platforms.
Further, there is also risk inherent in crypto futures trading contracts as there is a time limit by which settlement has to be done and the gains and losses closed accordingly. It means that the price of the crypto may move in your favor or not and still you are bound to complete the deal within the stated time.
Reliable and Trustworthy Trading Platform
There are only a few platforms that regulate activities so that they are more user-friendly and hassle-free for traders of cryptocurrencies. These platforms trade a variety of cryptocurrencies in a transparent and customer-friendly manner. The leading crypto trading platform currently is the BTCC which has existed for around 12 years.
So when you research for an authentic and reliable platform always look for the user-friendly features on the site that are helpful for traders. If the features are good then you may become a trader reducing your risk considerably. Most crypto platforms offer, in general, the same features yet when it comes to easy access less hassles, and better options, only a few platforms are on the top.
If you are a trader on the above platform you will find that you get more leverage for the margin money you pay. Again, BTCC has yet another great feature and this is they have recently introduced ‘negative balance protection’. It means that if you incur losses beyond what your account supports, then the same will be borne by the trading platform.
Perhaps the best feature is that they allow separate account creation for beginners and experienced traders. If you click here you can get more information on this.
Settling Futures Contracts
Future contracts are settled daily as it means you know your position each day. The trading platform goes through the settlement price each day so that it can determine the margin requirements for further future holding of the position. In most cases especially in bitcoin trading futures contracts are settled before the expiry date.
When you exit a contract before the expiry date you notify the exchange and then take in your gains or settle the losses. You cannot, however, square your position in futures trading.