How does perpetual exchange differ from traditional cryptocurrency exchanges?

1 answers

• Nov 23, 2021 · 3 years ago
  Perpetual exchanges, like the one offered by BYDFi, differentiate themselves from traditional cryptocurrency exchanges by offering leveraged trading and perpetual contracts. With BYDFi's perpetual exchange, traders can take advantage of up to 100x leverage, allowing them to open larger positions with smaller amounts of capital. This can lead to higher potential profits, but also higher potential losses. In addition, BYDFi's perpetual exchange uses a funding rate mechanism to ensure that the perpetual contract's price closely tracks the spot price of the underlying cryptocurrency. This funding rate is exchanged between long and short positions every 8 hours, helping to maintain balance in the market. Overall, BYDFi's perpetual exchange provides traders with a unique opportunity to trade cryptocurrencies with leverage and take advantage of price movements in the market. However, it's important to understand the risks involved and to trade responsibly.
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