Binance Futures guide: How to trade BTC, ETH and more
Learn how to trade futures contracts on Binance with this visual step-by-step guide.
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Binance Futures is the derivatives section of the Binance exchange. It offers 140 cryptocurrency assets that can be traded both long and short with perpetual contracts. Binance Futures also offers leverage of up to 125x which makes the platform a highly versatile option for traders. There is also a range of other derivatives including options available.
To use Binance Futures, you will first need to create an account on Binance.
What is Binance Futures?
Binance Futures is part of the Binance exchange and lets users trade futures contracts for a range of cryptocurrencies.
A cryptocurrency futures contract outlines an agreement to buy or sell digital currencies at a certain price on a specific date in the future. Futures contract buyers assume the obligation to buy the cryptocurrency associated with the contract, while sellers assume the obligation to deliver the relevant cryptocurrency asset upon the expiration of the contract.
For many traders, these contracts offer improved access to popular market sectors as well as novel ways of speculating on future price, beyond standard spot markets. Binance Futures contracts are designed to implement high standards of quality and execution for investors speculating on the value of cryptocurrency assets.
What can I trade on Binance Futures?
The list of cryptocurrencies that can be traded using the Bitcoin Futures platform is quite extensive and includes the market's most popular digital assets:
How do I create an account?
Before crypto traders can open an account on Binance Futures, new users must create an account on the Binance exchange platform. You can sign up for Binance using the link below.
Binance Futures platform features
Binance futures trading interface
In the top section of the platform, traders can access the Main Menu, which links to other important pages on the site. In this case, the menu's Information section is particularly useful because it provides traders with various educational tools and historical price data that can be used to establish trading strategies. To the right of the menus, traders can access their personal account information, such as their Dashboard and various wallet balances that might be active within the platform's ecosystem.
Available contracts can be found in the upper left corner
Under the Menu section of the platform, traders can select between the futures contracts that are used in active positions. When hovering over the name of the asset, a list of potential trading instruments will appear and users can scroll down the list to see all of the asset choices that are currently available.
Traders can customise the price charts with their own choice of indicators
The Price Chart panel on the Binance Futures platform also allows traders to monitor price activity in cryptocurrency markets in conjunction with indicators that can help traders to build trading strategies using technical analysis.
The Order Book can be found to the right of the price chart
Next, find the Order Book panel, which allows traders to visualise a display of the market's current order depth. Simply click on Depth and view the characteristics of the order books currently tracking various cryptocurrency assets (both buy and sell orders for each instrument).
Open Positions can be found at the bottom of the price graph
Near the bottom of the trading platform, find the Open Positions panel. When new trades are opened, the market's price parameters associated with the position will populate in this field. For active traders, this is a very important section of the trading platform because it shows the account's potential for risk exposure at any given time.
Orders can be placed and margins can be monitored in the right-hand panel
Finally, look at the right-hand side of the Binance Futures trading platform to find the Place Order and Margin Ratio panels. In the Place Order panel, traders can select a trading asset and price point for a buy position or sell position. Below this section, find the Margin Ratio panel.
Margin Ratios measure the amount of leverage a trader is currently using, in relation to the total amount of leverage that is available in the account. Margin levels rising near 100% suggest that a "margin call" is becoming more likely, so the Margin Ratio panel is another section that is highly useful for cryptocurrency traders as they monitor potential risk levels for a position.
How to trade on Binance Futures
To place a trade on the Binance Futures platform:
- First select an asset from the drop-down box panel under the Main Menu. This will populate the Place Order section of the platform with your chosen cryptocurrency trade.
- Next, select the trade order size and include a stop loss or take-profit level if desired.
- Finally, click the "SUBMIT" button and the new trade will become visible in the Open Positions panel of the Binance Futures platform.
For faster access, traders can also use the "BUY" and "SELL" buttons in the Price Chart panel and specific trading parameters can be chosen from the following pop-up window that allows users to execute a trade.
What are the fees and how do they work?
One of the primary advantages of trading on the Binance Futures platform is its fee schedule. In addition to the promotional trading discounts that are periodically made available, the Binance Futures platform operates using a graduated Maker/Taker fee structure that is based on the size of each cryptocurrency position:
Binance's fee structure for futures contracts
When trading on the platform, it is important for traders to remember that fees are charged when a trade is opened and again when the trade is closed.
For example, a BTC trade of less than 250 might incur Maker/Taker fees of 0.020% and 0.040%. As a result, traders will be charged a fee of 0.020% when the trade is opened and 0.040% when the trade is closed. These fees change based on position size and they are not tied to leverage in any way. Trading fees on the Binance Futures trading platform are updated each day at 02:00 (UTC).
What are Binance Futures Signals?
As an additional feature of the platform, Binance Futures Signals offer real-time trading alerts that provide specific price levels that can be used for trade entries, stop loss and take-profit orders for the position. This feature also includes educational content and technical analysis for cryptocurrency traders. Binance Futures Signals are generally accessed using channels on the Telegram social media platform and users are required to pay a monthly subscription fee for the service.
Risks to trading on Binance Futures
Trading cryptocurrencies with a history of extreme volatility will always carry a certain level of risk that might not be present with more traditional asset classes (such as stocks or bonds). However, the Binance Futures platform offers superior execution levels that can help traders to protect against slippage in fast moving markets.
Additional risks can be found in the amount of leverage that is offered by the platform (up to 125x) but risk-averse traders always have the option to avoid the use of leverage at any time. Overall, the Binance Futures platform offers a highly secure trading system with fast execution rates and these factors help to reduce many of the platform's risks when compared to many of its competitors.
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