What happens to the expiration of futures contracts for cryptocurrencies?

3 answers

• Dec 17, 2021 · 3 years ago
  When futures contracts for cryptocurrencies expire, several things can happen. If the contract is settled physically, the buyer will receive the actual cryptocurrency specified in the contract, while the seller will deliver the cryptocurrency. If the contract is settled in cash, the buyer will receive the difference between the contract price and the current market price, while the seller will pay the difference. It's important to note that not all futures contracts are held until expiration; many traders close their positions before the expiration date to avoid physical delivery or cash settlement.
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• Dec 17, 2021 · 3 years ago
  So, when futures contracts for cryptocurrencies expire, it's basically a settlement process. Depending on the type of contract, either the actual cryptocurrency is exchanged or the cash difference is settled. This expiration process is an essential part of futures trading, as it allows traders to profit from price movements without actually owning the underlying asset. It's also worth mentioning that futures contracts have specific expiration dates, usually on a monthly basis, and traders need to be aware of these dates to manage their positions effectively.
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• Dec 17, 2021 · 3 years ago
  When futures contracts for cryptocurrencies expire, the settlement process takes place. At BYDFi, for example, the contracts are settled in cash. This means that if you hold a futures contract until expiration, you will receive the cash equivalent of the difference between the contract price and the market price at expiration. This cash settlement allows traders to speculate on the price of cryptocurrencies without actually owning them. It's a convenient way to participate in the crypto market without the need for a digital wallet or dealing with the complexities of owning and storing cryptocurrencies.
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