Hello guys! I am CYPER, and today we are going to learn about the differences between the spot and futures market.
Nowadays, being a trader in the cryptocurrency world can be profitable. But, it also depends on how much you want to spend and in which market you are going to spend.
While trading on PCEX Member, you can find only two market options i.e. spot market and futures market.
Let’s watch this video to understand what is the difference between the two. But before this, let’s have a look at what spot and futures market are and how they work
Spot trading is the process of buying and selling cryptocurrencies for immediate delivery.
For example, if you bought 1 BTC with INR in the spot market, it will get credited to your wallet immediately.
Futures trading is the process of buying and selling crypto futures contracts for delivery on a specified date in the future. It is mainly used by traders to hedge or lock in profits with little investment.
Now, you have an understanding of the spot and futures market, let’s understand the key differences.
Delivery
Each contract in the futures market has a specific settlement date in the future. Wherein in the spot market, trades are executed between buyers and sellers for immediate delivery.
Leverage
Apart from that, the leverage in the futures market is far greater. This means that you can book a bigger profit with little investment. The spot market is best for those who want immediate delivery of cryptocurrencies with the money they have.
Hope you guys now understand the differences between spot and futures trading. If you found this video informative, do like this video and subscribe to our channel for watching more tutorial videos.
