Crypto Futures Explained: Differences Between Perpetual and Expiry Futures

Quick summary: Perpetual futures offer ongoing exposure without expiration, while expiry futures settle at a set date. Both are powerful tools to trade or hedge crypto positions effectively.

 

Crypto futures are growing fast and offer some cool ways to trade and hedge your bets. 

 

Perpetual futures let you hold a position as long as you want, without a set end date. Expiry futures have a fixed timeline, making them perfect for event-driven plays and clear risk control. 

 

This guide breaks down how both work, why they’re important in 2026, and how you can use them smartly to level up your crypto trading.

 

What Is a Perpetual Future and an Expiry Future?

Perpetual and expiry futures are both contracts that let you bet on the future price of an asset.

But, here’s the catch.

Perpetual futures never expire, so you can hold your position as long as you want. Expiry futures, on the other hand, have a set date when the contract ends and settles. 

Both these contracts let you speculate or hedge without actually owning the asset itself.

 

How Do Perpetual and Expiry Futures Work?

Think of perpetual futures like renting an apartment month-to-month. You don’t own the place. You’re just paying rent to stay. What’s more is that you can keep living there as long as you want. 

Every now and then, you might pay a small “funding fee” (like rent) that keeps your contract price aligned with the actual market value.

Expiry futures are more like signing a lease for a set term, say 12 months. When the lease ends, you have to move out or renew. Similarly, expiry futures settle automatically on a specific date, either paying out in cash or delivering the asset. 

Traders deposit some collateral upfront to cover risks, and both types update their value regularly to reflect ongoing market prices.

Why Do Perpetual vs Expiry Futures Matter in 2026?

Perpetual futures give traders the freedom to hold their positions as long as they want since there’s no expiration date, making them ideal for active trading and hedging. Expiry futures, on the other hand, have a set end date. It works well for event-driven strategies and clear risk management. 

Last 2025, perpetual futures dominated the crypto market. It made up over 90% of Bitcoin futures volume on major exchanges like Binance and OKX, while expiry futures accounted for less than 10%. This shows how much traders value the flexibility and continuous trading perpetual futures offer. 

Looking ahead to 2026, perpetual futures are expected to keep growing because of innovations in DeFi and better features on centralized exchanges. 

Plus, their funding fees. Payments between traders to keep prices aligned with the real market. This potentially creates extra opportunities for savvy arbitrageurs.

Key Use-Cases

Let’s check out some common ways traders use perpetual and expiry futures to their advantage.

• Hedging Long-Term Exposure: Using perpetual futures to maintain market exposure without liquidation deadlines.
• Event-Driven Trading: Employing expiry futures to capitalize on specific events before contract expiry.
• Leverage Trading: Both contract types allow leveraged positions to amplify gains (or losses).
• Arbitrage Strategies: Exploiting funding rate differences in perpetual futures.

These examples show how flexible futures can be, whether you’re hedging, trading events, using leverage, or playing arbitrage opportunities.

Risks & Ethical Concerns

Trading crypto futures comes with quite a few risks, and it’s important to know what you’re getting into. For example, forced liquidation happens when volatile market swings trigger margin calls that close out your position automatically.

This can wipe out your initial investment. 

To avoid this, use reasonable leverage and set stop-loss orders. 

Another risk is funding rate volatility, especially with perpetual futures, where fees can be high and eat into your profits if you hold positions too long. 

Market manipulation, like wash trading to fake prices, is also a concern, but regulators and exchanges work to spot and stop these practices. The FATF has guidance on preventing manipulation and money laundering in crypto markets. 

Following their advice and trading carefully will help keep risks in check.

Future Trends

Looking ahead, the future of crypto futures trading is shaping up to be really exciting and tech-driven. We’re likely to see more hybrid futures products that blend features from both perpetual and expiry contracts, giving traders more flexibility. 

Here are some examples of hybrid crypto futures products/platforms:

• Bitget: Combines centralized liquidity with decentralized wallets for security and user control.
• Loopring: Uses centralized order books with decentralized custody via zkRollups for fast, cheap trades with asset control.
  
• Binance DEX: Offers high liquidity and speed alongside smart contract-powered wallet self-custody.
• Gemini: Combines strict centralized compliance for institutions with decentralized wallets for user flexibility.
• Coinbase: Provides non-custodial wallet services paired with advanced centralized exchange features.
• DeriW: A decentralized perpetual futures platform built on Arbitrum, offering zero gas fees, fast trades (up to 80,000 TPS), and user-controlled wallets. It combines speed, security, and low cost in one hybrid solution.

Regulatory clarity is also improving worldwide, helping exchanges and traders navigate compliance with confidence. On the tech side, AI-driven risk management tools are becoming big players. These can spot risks faster and help manage trades more efficiently. 

Lastly, expect futures trading to expand beyond just cryptocurrencies into newer asset classes like NFTs and tokenized real-world assets, opening up fresh opportunities for investors.

How to Get Started

1. Choose a reputable crypto futures exchange like CoinW.
2. Start with demo trading or small positions.
3. Define your risk tolerance and trading goals.
4. Monitor funding rates and expiration dates closely.
5. Employ risk management tools such as stop-loss and take-profit orders.

FAQs

1. What is the main difference between perpetual and expiry futures?

Perpetual futures have no expiry date, while expiry futures settle on a fixed date.

2. Do perpetual futures have funding fees?

Yes, funding rates incentivize price alignment with the spot market.

3. Can I use expiry futures for long-term investments?

Usually, expiry futures are better for short to medium-term strategies due to settlement dates.

4. Are futures trading platforms regulated?

Many are regulated, but regulations vary by jurisdiction. Always use trusted exchanges.

Conclusion

Understanding the difference between perpetual and expiry futures is super helpful for traders and investors to pick the right tool for their game plan, especially in 2026 and beyond. 

The crypto world keeps changing fast. 

To really make the most of trading futures, you’ve got to understand how they work and what risks come with them. That way, you can protect your money and boost your chances of success.

Sign up for CoinW to explore futures trading and subscribe for weekly crypto insights.

 

About CoinW

Founded in 2017, CoinW is a leading global cryptocurrency asset trading platform with intelligent trading services, average daily volumes of over $5 billion, and 10+ million users. Learn more at the site, follow on X, or join Telegram for updates.