A Futures Contract is a derivative product and is an agreement to buy or sell a commodity, currency or other instrument at a predetermined price at a specified time in the future (subject to the Early Settlement). They are either physically settled or cash settled. BitMEX offers several of its trading products in the form of a Futures Contracts with cash settlement.
Futures contracts do not require traders to post 100% of collateral as margin, because of this you can trade with leverage of up to 100x on some of BitMEX contracts. All margin on BitMEX is denominated in Bitcoin, allowing traders to speculate on the future value of its products only using Bitcoin.
BitMEX offers futures contracts that have inverse, quanto, and linear payouts. This document explains the key differences between these payouts, and some implications for traders.
The table below shows the futures contracts that are currently available for trading on BitMEX.
|Contract||Contract Specs||Expiry*||Index||Payout Type||Max Leverage||Multiplier|
|XBTU21||XBTU21 details||9/24/2021||.BXBT30M||Inverse Futures||100x||1 USD|
|XBTEURU21||XBTEURU21 details||9/24/2021||.BXBTEUR30M||Inverse Futures||50x||1 EUR|
|XBTZ21||XBTZ21 details||12/31/2021||.BXBT30M||Inverse Futures||100x||1 USD|
|BCHU21||BCHU21 details||9/24/2021||.BBCHXBT30M||Linear Futures||20x||1 XBT|
|ADAU21||ADAU21 details||9/24/2021||.BADAXBT30M||Linear Futures||20x||1 XBT|
|EOSU21||EOSU21 details||9/24/2021||.BEOSXBT30M||Linear Futures||20x||1 XBT|
|ETHU21||ETHU21 details||9/24/2021||.BETHXBT30M||Linear Futures||50x||1 XBT|
|ETHUSDU21||ETHUSDU21 details||9/24/2021||.BETH30M||Quanto Futures||50x||0.000001 XBT|
|LTCU21||LTCU21 details||9/24/2021||.BLTCXBT30M||Linear Futures||33.33x||1 XBT|
|XRPU21||XRPU21 details||9/24/2021||.BXRPXBT30M||Linear Futures||20x||1 XBT|
|TRXU21||TRXU21 details||9/24/2021||.BTRXXBT30M||Linear Futures||20x||1 XBT|
* - Subject to the Early Settlement
|Underlying||1/XBTUSD or USDXBT||LTCXBT||ADAUSDT|
|Multiplier||$1||1 XBT||0.01 XBT|
|Margin & PNL Currency||XBT||XBT||XBT|
|XBT Value of 1 Contract||1/Price * $1||Multiplier * Price||Multiplier * Price|
|USD Value of 1 Contract||$1||.BXBT * XBT Value||.BXBT * XBT Value|
|XBT PNL of 1 Contract||(1/EntryPrice - 1/ExitPrice) * $1||(ExitPrice - EntryPrice) * Multiplier||(ExitPrice - EntryPrice) * Multiplier|
A quanto is a type of derivative in which the underlying is denominated in one currency, but the instrument itself is settled in another currency at some fixed rate. Our Quanto Futures operate this way.
These contracts are designed to be easy to trade and understand, but keep in mind as you trade them that your underlying margin and PNL are in Bitcoin. You are still exposed to Bitcoin/USD price risk when trading Quanto Futures, even though the underlying and quote currencies are not Bitcoin.
A linear payout is the simplest to describe, and is used for many altcoin futures. The price of a linear contract is expressed as the price of the underlying against XBT. Each contract is usually worth one unit of the underlying. To help users understand the USD price of linear contracts, the dollar value is shown in grey in the Contract Details. This is calculated by multiplying the contract price by the .BXBT price.
An inverse contract is worth a fixed amount of the quote currency. In XBT futures’ case, each contract is worth $1 of Bitcoin at any price. XBT futures are inverse contracts because they are quoted as XBT/USD but the underlying is USD/XBT or 1 / (XBT/USD). They are quoted as an inverse to facilitate hedging US Dollar amounts while the spot market convention is to quote the number of US Dollars per Bitcoin.
This product is suitable for traders who need to lock in a USD value of Bitcoin. If you were due to receive $100,000 of Bitcoin in three months, you would sell 100,000 XBT futures contracts to lock in the Bitcoin value.
When trading futures contracts, a trader needs to be aware of several mechanics of the futures market. The key components a trader needs to be aware of are:
See the Futures Guide Examples for more information on: