- Crypto perpetual contracts offer bundles of similar tokens in one package
- They are easier to trade and can insulate against a single underperforming coin
- Crypto perpetual contracts could be a better alt season alternative for many
Have you spent hours combing through Twitter, YouTube, and crypto forums to find the perfect alts to take you to that elusive 100x in alt season? Well you might be wasting your time. Binance and FTX are among the exchanges offering crypto perpetual contracts, indexes of coin types that allow you to put your money behind an index of multiple coins rather than having to research and buy individual ones, potentially increasing your scope and making trading easier in the process.
What Are Crypto Perpetual Contracts?
Crypto perpetual contracts are simply baskets of coins bundled up into one contract, allowing you to gain exposure to several coins at once. For example, FTX’s ALT-PERP contract is a basket of ETH, EOS, BCH, BNB, LTC, XRP, TRX, DOT, LINK and ADA, which is more than enough for one person’s alt season wishes! If you think those coins are about to perform well then it makes sense to buy the perpetual rather than all the underlying assets, plus it’s cheaper in terms of trading fees.
Binance is another exchange offering perpetuals, such as their DeFi perpetual which comprises BAND, COMP, KAVA, KNC, AAVE, LINK, MKR, SNX, SXP, and ZRX. So if you think DeFi is due a comeback you can simply buy up the Binance DeFi perp contract with one click rather than having to pick and choose your coins.
Perpetual contracts like these also allow margin trading too, meaning that you can double down on your convictions and potentially make a killing – although of course leverage trading carries its own risks and isn’t for everyone.
Hard Work Done For You
There are of course downsides to perpetual contracts over buying the individual tokens. Bundling all the coins up together means that you can’t simply cut one out if it is underperforming – one or two badly performing coins can drag the whole average down and undo the good work being done by others. However, if you find yourself forever struggling to come up with a potentially winning portfolio, crypto perpetual contracts can do the hard work for you with the same end result.
