Binance futures offers two types: perpetual contracts and delivery contracts. Most people trade perpetuals, but delivery contracts have their advantages in certain scenarios. Understanding the differences helps you pick the right tool.
Perpetual Contracts: No Expiration Date
The biggest feature of perpetual contracts is that they have no expiration date. You can hold a position for as long as you want and close it whenever you choose (as long as you don't get liquidated). This flexibility is what makes them the most popular option.
However, because there's no expiration, perpetual contracts need a mechanism to keep their price close to the spot price. That mechanism is the funding rate — a payment exchanged between longs and shorts every 8 hours.
Delivery Contracts: Fixed Expiration Date
Delivery contracts have a specific expiration date. For example, a "quarterly contract" settles automatically at the end of the quarter. When it expires, the system force-closes your position at the settlement price, regardless of whether you're in profit or loss.
Delivery contracts have no funding rate, meaning there are no periodic fees for holding a position. For traders looking to do medium-to-long-term hedging or arbitrage, this is a clear advantage.
Which Is More Popular
On Binance, perpetual contracts see far more volume than delivery contracts, and their liquidity is much better. Most retail traders choose perpetuals because:
- More flexible — you can close anytime
- More trading pairs available, covering all popular coins
- Better depth and smaller slippage
Delivery contracts are mainly used by institutions and professional traders with arbitrage strategies.
Which Should Beginners Choose
If you're just getting started with futures, go with USDT-margined perpetual contracts. They're the most intuitive to understand, have the best liquidity, and Binance's tutorials and tools are most comprehensive for this type.
When you enter futures trading on the Binance App or website, the default page is already set to perpetual contracts. If you need to sign up for Binance, you can activate futures after completing registration and identity verification.
Risk Warning: Whether perpetual or delivery, leveraged trading carries the risk of liquidation. Beginners should learn the rules first and practice with small amounts or the testnet before trading with significant capital.