All terms
A futures contract with no expiry, kept in line by a funding rate.
Perpetuals let you take leveraged long or short exposure indefinitely. A funding payment passes periodically between longs and shorts to keep the contract price near spot.
Funding is a useful sentiment gauge. Persistently high positive funding means longs are crowded and paying to stay in, which often precedes a flush.
Hyperliquid and dYdX offer perpetuals onchain. Most crypto derivative volume is in perps, not spot.
That a perpetual tracks spot exactly. Funding pulls it toward spot and does not pin it, and in violent moves the perp leads and overshoots. That gap is where liquidation cascades come from.
Common questions
What is the difference between a perp and a future?
Why are perps so popular in crypto?
Where this comes up on the site
The guides that actually use this word, rather than a list of everything we have written.
Where to go next
More defi terms
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