Perpetual Futures vs Spot: What Actually Differs

Spot trading means owning the asset. Perpetuals mean holding a contract with funding payments, leverage and a liquidation price. The mechanics matter more than the leverage.

Last reviewed 2026-09-14

Spot

You buy the asset and own it. You can withdraw it to a wallet, hold it forever, and nothing can force you to sell. Your maximum loss is what you paid. There is no position to maintain and no ongoing cost.

Perpetual futures

You hold a contract that tracks the price. You never own anything. Three mechanics define it:

Leverage. Margin of $1,000 at 10× controls $10,000 of exposure. Profits and losses are calculated on the $10,000.

Funding. With no expiry date, something has to keep the contract near spot. Every eight hours the side that is crowded pays the other. When the perpetual trades above spot, longs pay shorts. Current rates sit around 0.01% per period in normal conditions — roughly 11% annualised — and go far higher when positioning is one-sided.

Liquidation. If losses eat your margin past the maintenance threshold, the exchange closes the position at market. Not a margin call, not a warning. The liquidation calculator shows where that sits.

The comparison

The thing people get wrong about leverage

Leverage does not change your profit in dollars. A 10% move on $10,000 of exposure makes $1,000 whether you posted $10,000 or $1,000 of margin. What it changes is how far price can move against you before you are removed from the trade.

At 10× a roughly 9.5% adverse move liquidates you. Bitcoin has 9% days several times a year, and 9% hours more often than anyone expects. The trade can be right and still end before it works — that is the actual cost of leverage, and it is not visible in the fee schedule.

When each makes sense

Spot for holding, for accumulating, for anything where being forced out at the wrong moment would be fatal to the thesis.

Perpetuals for short exposure, for hedging a spot position without selling it, and for expressing a view over hours or days where funding is a rounding error.

Neither at high leverage for a directional bet you feel strongly about. Conviction and leverage are a bad combination: the conviction stops you cutting the position and the leverage stops you surviving it.

Before opening one

1. Size from risk, not from a round number — the position size calculator.
2. Check where liquidation sits, and confirm it is well beyond your stop.
3. Check funding. Holding a crowded long through a week of elevated funding costs real money.
4. Check open interest. Entering a crowded trade means sharing the exit with everyone else.