What Are Futures? The Biggest Difference From Spot Is That You Don't Hold the Coin
Guides · · Satoshi Note Editorial
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Words like "long", "short" and "perpetual" show up all over Satoshi Note. This page explains the idea underneath them, assuming you have never traded futures.
At a glance
- Spot means buying and selling the actual coin. Futures means trading a contract on the coin's price.
- That lets futures bet on a falling price (short) and handle more value than the money you put up.
- The trade-off: if the money you put up runs low, the exchange can close the position by force. That is liquidation.
- This is a concept guide, not advice to trade. Exact rules differ by exchange.
Spot is buying the thing; futures is betting on its price
Spot trading is simple. Buy 1 bitcoin on an exchange and 1 bitcoin appears in your account. If the price rises you gain, if it falls you lose, and you cannot lose more than you put in.
Futures are different. You do not receive bitcoin. You enter a contract on where the price goes. If it moves your way you receive the difference; if it moves against you, you pay it. No coin changes hands, only the difference is settled.
Three things only futures allow
1. Betting on a fall. A position betting on a rise is a long; one betting on a fall is a short. With spot you can only hold. With futures, a short lets you take the other side.
2. Handling more than you put up. Putting up money as collateral (margin) and trading a multiple of it is leverage. With $100 of margin at 10x, the position is worth $1,000. We cover this in the leverage guide.
3. No expiry date. Most crypto futures are "perpetual" contracts with no expiry. Instead, longs and shorts periodically pay each other a funding fee, a mechanism that keeps the futures price from drifting far from spot. Which side pays changes over time.
The price of those features: liquidation
Because you trade a larger amount than your collateral, a move against you can use up that collateral, and the exchange then closes the position for you. That is liquidation. With spot you can keep holding through a drop; with futures you can be forced out. The mechanics are in our liquidation beginner guide.
Side by side
| Spot | Futures (perpetual) | |
|---|---|---|
| What you receive | The coin | A contract on price (difference settled) |
| Betting on a fall | Hard | Possible with a short |
| More than your own money | Usually not | Possible with leverage |
| Forced close | None | Liquidation if collateral runs short |
| Holding cost | None | Funding fees may apply |
| Maximum loss | What you put in | Up to the collateral (varies by exchange) |
How it shows up in Satoshi Note
Most trader positions Satoshi Note shows are futures positions: long or short, size, and liquidation price on one row. If a term is unfamiliar, see the trading glossary. How these positions are opened on platforms like Hyperliquid continues in the exchange vs DEX guide.
FAQ
Are futures always riskier than spot?
Because of collateral and liquidation, losses can grow faster for the same amount. How risky depends on the leverage and position size. This page does not rate risk.
Does shorting mean borrowing the coin?
Conceptually similar, but a futures short is a contract on a price drop, not an actual borrowed-and-sold coin. Internal handling differs by exchange.
Is the futures price the same as spot?
Close, not identical. For perpetuals, funding fees work to narrow the gap.
Can I trade futures on my local exchange?
This page does not say what is available where. Check the exchange's own notices and local rules.
This is a concept explainer by the Satoshi Note editors. It does not predict prices or recommend any trade. Exchange rules follow each exchange's own documentation. As of 2026-11-09.