US Perpetual Futures are futures contracts with no expiration date, designed to closely track an underlying asset’s spot price while trading continuously — bringing the structure that’s long been popular in international, largely unregulated perpetual futures markets into a US-regulated environment.
Key Takeaways
- Unlike traditional futures with a set expiration, perpetual futures can be held indefinitely, with no forced settlement date.
- A ‘funding rate’ mechanism periodically exchanges payments between long and short holders, designed to keep the perpetual contract’s price closely tracking spot.
- International perpetual futures markets have existed and been popular in crypto for years; US Perpetual Futures bring the structure into a CFTC-regulated framework.
- Because there’s no expiration, perpetual futures require ongoing margin maintenance for as long as a position is held.
- The regulated US version offers the trading structure many crypto traders already know, within a domestic framework.
Our Take
The funding rate mechanism is the piece of perpetual futures design that most distinguishes them from traditional futures: because there’s no expiration to naturally force the contract’s price back in line with spot, the funding rate creates an ongoing financial incentive that keeps the two prices from drifting too far apart.
Bringing this already-popular structure into a US-regulated framework addresses a real gap that’s existed for American traders, who previously needed offshore, unregulated platforms to access perpetual futures.
FAQs
How do perpetual futures stay close to the spot price without an expiration date?
Through a funding rate mechanism — periodic payments exchanged between long and short holders — that keeps the contract’s price closely aligned with spot.
Do I need to close a perpetual futures position eventually?
Not by forced expiration — you can hold it indefinitely, as long as you maintain required margin, and close it by your own choice.
📎 Source: Coinbase Learn — US Perpetual Futures 101
