Bitcoin futures (bitcoin futures, bitcoin futures contract) is an obligation to sell or buy a certain number of bitcoins at a certain price before the expiration of the contract.
The concept of futures, or, in a broader sense, a derivative, that is, a derivative financial instrument. A derivative is a financial contract between parties to a transaction that is based on the future value of an underlying asset. This contract has certain conditions for its existence and implementation, the main ones being the execution price and the duration of the contract. The underlying asset can be any goods or services. In our case, the underlying asset is Bitcoin.
Futures (futures contracts) are the most common type of derivatives. Under the terms of such a derivatives contract, its holder undertakes to buy or sell a certain amount of the underlying asset at a fixed price within a strictly specified period. Futures can be bought and sold before their expiration date, and these transactions do not require payment of the full value of the assets fixed in the futures contract. Only part of the full value of the transaction, the so-called collateral, is pledged as collateral for the right to own the futures.
The collateral, which is considered to be the futures price, can be only 10-15% of the transaction amount. In this case, the “leverage” effect occurs, and market participants have the opportunity to receive a relatively large income with small investments.
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