Cryptocurrency and digital asset exchange CrossTower has unveiled its new perpetual futures trading feature, marking a significant expansion of its derivatives offerings. The product will debut on CrossTower’s Bermuda-based digital exchange platform.
Understanding Perpetual Futures
Unlike traditional futures contracts with fixed expiration dates, perpetual futures are derivative instruments designed to trade indefinitely. Key characteristics include:
- No expiry date: Positions can remain open indefinitely with proper funding rate mechanisms.
- Flexible strategies: Enables both long and short positions aligned with investors’ portfolios and risk profiles.
- Institutional-grade access: Initially available to qualified clients on CrossTower’s regulated institutional platform.
Strategic Advantages for Traders
CrossTower emphasizes three core benefits of its new offering:
- Portfolio diversification: Seamlessly integrate crypto derivatives into investment strategies
- Risk management tools: Hedge positions with perpetual contracts
- Market accessibility: Trade top cryptocurrencies without expiration constraints
The exchange plans to roll out perpetual futures for 20 leading tokens within weeks, significantly broadening market exposure opportunities.
Industry Context: The Rise of Crypto Derivatives
The perpetual futures launch coincides with surging demand in crypto derivatives markets:
- Market growth: Global daily trading volume for Bitcoin perpetual futures averaged $62 billion in 2021 (CoinGlass)
- Record open interest: Bitcoin perpetual futures reached $18 billion open interest in March 2022
- Institutional adoption: Increasing participation from hedge funds and corporate treasuries
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Leadership Perspective
Kapil Rathi, CrossTower’s CEO and co-founder, underscored the product’s strategic importance:
"Perpetual futures provide investors with essential tools to shape their investment objectives. The advantages for portfolio construction are compelling, and we're proud to contribute to the digital asset ecosystem's maturation through innovative trading products."
Frequently Asked Questions
Q: What makes perpetual futures different from regular futures?
A: Perpetual futures eliminate expiration dates while maintaining similar leverage and trading mechanics, using funding rates to anchor prices to spot markets.
Q: Who can access CrossTower’s perpetual futures?
A: Initially available to institutional and qualified retail clients on regulated platforms, with plans for broader accessibility.
Q: Which cryptocurrencies will support perpetual futures?
A: CrossTower will progressively add support for 20 top tokens beyond Bitcoin and Ethereum.
Q: How does this benefit long-term crypto investors?
A: Enables sophisticated hedging strategies and exposure management without rolling contracts.
Market Outlook
Analysts highlight several trends driving perpetual futures adoption:
- Mainstream integration: Traditional finance increasingly incorporates crypto derivatives
- Product sophistication: Exchanges compete with innovative contract designs
- Regulatory evolution: Bermuda’s progressive framework supports CrossTower’s expansion
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Disclaimer: Trading derivatives involves significant risk. Consider your investment objectives and risk tolerance before participating.