Top Crypto Futures Trading Platforms
To rank the top 5 crypto futures platforms, we utilized a comprehensive methodology that included several key factors. We assessed the available assets, trading volume and liquidity of each platform to ensure there was a high level of open interest and activity on contracts.
We also evaluated the fees associated with each exchange to determine their competitiveness. In addition to this, we analyzed the overall user experience and trading features, including order types and trading tools, to ensure the platform is user-friendly and provides advanced trading options.
1. Bybit
Bybit has established itself as the best overall futures exchange due to its unparalleled trading experience, security, and reliability. With its intuitive user interface and advanced trading features, Bybit offers a seamless trading experience to investors of all levels. The exchange's deep liquidity, low fees (Maker 0.01% & Taker 0.06%), wide selection of crypto assets (400+) and 25x leverage make it an attractive option for traders.
Additionally, Bybit's commitment to security has earned it a strong reputation in the industry, making it a trusted platform for investors looking for a safe trading environment. Bybit is one of the only exchanges in the world that provide a real-time audited proof-of-reserves that highlights all customer's funds are fully reserved. This is why we prefer to use Bybit over exchanges like Binance which don't provide this level of transparency.
2. Binance
Binance is another leading crypto futures exchange, offering over 350 futures contracts on a variety of crypto assets. Binance is known for its competitive fees (Maker 0.01% & Taker 0.05%) and deep liquidity, making it a top choice for institutional investors. The platform currently accounts for over 60% of open interest across derivatives contracts in crypto, making it the most popular futures platform by volume.
What sets Binance apart is its institutional-grade liquidity, which is backed by its expertise in asset management and experience providing financial services to institutions. Binance also offers advanced trading tools like TWAP & Iceberg Order Types and an API for institutions to connect their trading algorithms directly to the exchange.
3. OKX
OKX is another popular global alternative platform to trade crypto futures contracts and other derivatives. The platform offers just over 200 cryptocurrencies and less competitive fees than Bybit and Binance at 0.2% Maker and 0.05% Taker. OKX and their futures platform is geared more toward retail investors with a simple user-interface and sleek iOS & Android App to trade futures, spot markets and even NFTS with their in-built marketplace.
OKX also offers up to 50x leverage and a variety of order types, like Iceberg Orders & TWAPs. Additionally, the platform provides advanced risk management tools such as Liquidation Protection & Auto Deleveraging to protect users from margin calls and liquidations.
4. Gate.io
Securing its position as the fourth-leading futures platform in the cryptocurrency industry, Gate.io has established a unique niche by offering a seamless futures trading experience without the necessity of Know Your Customer (KYC) procedures. This user-focused approach offers traders an effortless onboarding and trading process, effectively eliminating the need for arduous identity verification.
Gate.io's popularity is further substantiated by its unmatched selection of cryptocurrencies. The platform champions an unparalleled catalogue of over 1,400 unique digital assets – the most extensive range available on any exchange. Complementing this expansive crypto offering, Gate.io presents competitive fees, with a maker rate of 0.01% and a taker rate of 0.06%. The platform also allows traders to engage with up to 125x leverage, providing opportunities for amplified profit margins.
5. GMX
GMX is the largest and most popular decentralized futures platform that is currently live on the Arbitrum Layer 2 and Avalanche blockchain. With GMX, users can connect with a MetaMask or alternative account to trade up to 25x leverage on 30+ digital assets including BTC, ETH, AVAX, ATOM, UNI and more. The platform is the most liquid DeFi perpetual exchange with over $180 million in daily open interest.
As an on-chain platform, we only recommend using this if you are an advanced DeFi user. This is because it requires some knowledge of connecting wallets, using RPC URLs and understanding the risks associated with decentralized trading. However, for those who are comfortable with on-chain trading, GMX offers many unique advantages for you to benefit from.
What are Futures in Crypto?
Futures in cryptocurrency are financial contracts that obligate the buyer to purchase, and the seller to sell, a specific quantity of cryptocurrency at a predetermined price and date in the future. They are standardized contracts traded on a futures exchange. These financial instruments are derived from the value of the underlying cryptocurrency, which means they are derivatives. Traders use futures contracts for two primary purposes:
- Hedging: This involves taking a position in the futures market that is opposite to a position in the physical (or spot) market, with the aim of reducing the risk of financial loss from adverse price changes.
- Speculation: Speculative trading involves trying to predict future price movements, with the aim of making a profit. Traders can go long (buying a futures contract in the expectation that the price will go up in the future) or go short (selling a futures contract with the expectation that the price will go down in the future).
One unique feature of cryptocurrency futures is that they are often traded on leverage, which means that traders can control large positions with a relatively small amount of capital. This can magnify profits, but it can also magnify losses.
Is Crypto Futures Trading Legal?
In many countries, such as the United States, the United Kingdom, and the European Union, crypto futures trading is typically legal. Crypto futures, which are financial contracts enabling traders to predict cryptocurrency prices without ownership, are legally accepted in various jurisdictions due to regulation by financial authorities. These authorities enforce rules to safeguard investors and uphold market stability.
Centralized vs Decentralized Futures Exchanges
Centralized and decentralized futures exchanges both allow traders to buy and sell futures contracts. Centralized exchanges are owned and operated by a single entity, are highly regulated, and act as intermediaries between buyers and sellers. Decentralized exchanges are built on a blockchain network, run on smart contracts, and offer greater privacy and security since users hold their funds in their own wallets.
Deciding between a centralized or decentralized exchange depends on personal preferences, with centralized exchanges offering greater liquidity and advanced trading tools while decentralized exchanges provide more security and control over funds. For example, you would not be subject to the collapse of platforms like FTX if you use a non-custodial & decentralized futures exchange like GMX or DYDX.
The Bottom Line
In summary, crypto futures trading has seen significant growth, prompting the rise of numerous platforms offering this service. After a thorough analysis, our top 5 recommended exchanges are Bybit, Binance, OKX, Gate.io, and GMX. Each has unique strengths: Bybit excels in overall user experience, Binance is favored by institutional investors, OKX provides a solid alternative, Gate.io caters to those who prefer to avoid KYC procedures, and GMX leads in the DeFi space.
Our assessment considered factors like trading volume, liquidity, fees, and user experience. While centralized exchanges offer more liquidity and advanced trading features, decentralized exchanges offer increased security and control over one's assets. Therefore, the final choice hinges on personal preferences and trading goals.
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