An Introduction to Kraken
Kraken is a cryptocurrency exchange platform that was established in 2011. It has since become one of the most popular platforms for trading in cryptocurrencies such as Bitcoin, Ethereum, and Litecoin. The platform is known for its high-level security features and user-friendly interface, making it a go-to option for both novice and experienced traders.
What are Futures?
Futures are a type of financial instrument that allow individuals to speculate on the future price of an asset. Futures contracts are agreements to buy or sell an asset at a predetermined price and date in the future. The value of a futures contract is determined by the underlying asset’s price.
Does Kraken Offer Futures?
Yes, Kraken does offer futures trading on its platform. In fact, Kraken was one of the first cryptocurrency exchanges to offer futures trading, alongside other major exchanges such as BitMEX and Deribit.
Types of Futures Offered by Kraken
Kraken offers two types of futures contracts: perpetual futures and futures with expiry dates. Perpetual futures contracts do not have an expiry date, while futures with expiry dates have a predetermined expiry date.
Perpetual Futures
Perpetual futures contracts are similar to spot trading, as they do not have an expiry date. Traders can hold positions for as long as they want, with the contract’s value being determined by the underlying asset’s price.
Futures with Expiry Dates
Futures contracts with expiry dates, on the other hand, have a predetermined expiry date. Traders can buy or sell contracts that expire on a specific date, with the contract’s value being determined by the underlying asset’s price at the time of expiry.
Advantages of Futures Trading on Kraken
There are several advantages to trading futures on Kraken, such as:
Leverage
Kraken offers up to 50x leverage on futures trading, which allows traders to increase their exposure to the market and potentially increase their profits.
Ability to Short
Futures trading on Kraken allows traders to short an asset, meaning they can profit from a decrease in the asset’s price. This is a unique advantage that is not available in traditional spot trading.
Low Fees
Kraken has some of the lowest fees in the industry, making it an attractive option for traders who want to minimize their trading costs.
High Liquidity
Kraken has a high level of liquidity, meaning that there is a large volume of trades being made on the platform at any given time. This makes it easier for traders to enter and exit positions without affecting the market price of the asset.
Conclusion
In conclusion, Kraken does offer futures trading on its platform. Traders can take advantage of the various features and advantages that come with trading futures, such as leverage, the ability to short, low fees, and high liquidity. As with any type of trading, it is important to do your own research and understand the risks involved before making any trades.
