Perpetual futures

When the perpetual trades above the spot price, holders of long positions pay holders of short positions; when it trades below, shorts pay longs. The payment pulls the contract back toward spot without an expiry date. A trader who buys bitcoin spot and sells the perpetual earns the funding rate while it is positive and carries no price risk, the crypto version of the cash-and-carry trade described on the bitcoin basis trade page.

The same trade is the engine of a product outside the exchanges: Ethena describes its USDe as "a synthetic dollar, backed with crypto assets and corresponding short futures positions", and part of its revenue comes from these delta-neutral basis trades. The Ethena page covers that model and the BaFin case around it. Positions are margined, so a sharp price move can liquidate many of them at once; the crypto derivatives page explains liquidation cascades and margin.

A perpetual future is a derivative, so in the EU it falls under MiFID II; MiCA does not apply to it. A provider needs an investment firm license or a trading venue license. Kraken launched MiFID II regulated perpetual and fixed-maturity crypto futures for clients in the European Economic Area in May 2025, through a firm licensed in Cyprus. Coinbase began offering futures, among them perpetual contracts, to clients in 26 European countries including Germany under its MiFID II license.

The European crypto exchanges page lists which exchanges hold which licenses, and the Kraken page covers Kraken's licenses in Europe.

On February 24, 2026, ESMA reminded firms that perpetual futures and perpetual contracts giving leveraged exposure to crypto-assets are likely to fall within the national product intervention measures on contracts for difference (CFDs). Where they do, retail clients get leverage limits, a risk warning, margin close-out and negative balance protection, and firms may not offer bonuses. ESMA added that the product name, trading on a venue and a funding rate do not change the assessment, asked for a narrow target market and an appropriateness test for non-advised sales, and warned about conflicts of interest where a group company runs the venue.

Crypto derivatives and the firms that offer them under EU licenses are a subject at the Crypto Assets Conference in Frankfurt, which Finance Loop has partnered with. Finance Loop supported the Bybit EU Crypto Evening at TechQuartier on compliance under MiCAR, and brings trading and compliance teams together at events in Frankfurt, Munich, Berlin and Hamburg.

Perpetual futures are futures contracts without an expiry date. A funding payment between longs and shorts, usually every few hours, keeps their price close to the spot price of the underlying.

The funding rate is the periodic payment between the two sides of a perpetual future. It is positive when the contract trades above spot, so longs pay shorts, and negative when it trades below.

Yes, when a firm offers them under a MiFID II license. ESMA expects such products to follow the CFD rules for retail clients, with leverage limits and negative balance protection.

A dated future expires on a set day and settles against the underlying. A perpetual future runs until the holder closes it, and the funding rate replaces the convergence that expiry brings.