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Binance launches COIN- and USDT-margined categories for futures

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Digital asset exchange provider Binance has launched COIN- and USDT-margined product categories for its range of perpetual and quarterly futures to highlight the use of bitcoin and altcoins as the currencies for settlement. The new categorisation puts cryptocurrencies on more equal footing with fiat, and reflects the increased interest in futures margined and settled with bitcoin and altcoins. 

Users on Binance Futures can now select futures contracts as follow:

• COIN-margined Futures (displayed as “COIN-Ⓜ” on the web and mobile app)
Quarterly Futures

• Perpetual Futures (to be launched Q3 2020)

• USDT-margined Futures (displayed as “USDT-Ⓜ” on the web and mobile app)
Perpetual Futures

USDT-margined futures are similar to traditional standard futures, margined and settled with a fiat currency, for delivery of a commodity or asset such as gold. COIN-margined futures are margined and settled with the asset instead (ie bitcoin or altcoin), and are designed after “inverse” contracts which are counterintuitive in traditional finance. The instant and fungible nature of cryptocurrencies has popularized COIN-margined contracts, eg BTC- or ETH-margined futures.

The instant settlement of cryptocurrencies also highlights a fundamental advantage they have, as they can be easily used as both the currency for settlement and the underlying asset in futures for various hedging strategies. 

“Our combined COIN- and USDT-margined futures volume hit a daily all-time-high of USD13 billion last week and we will continue to offer users the best experience and range of products on our trusted trading platform. Unlike with traditional markets, “inverse” cryptocurrency contracts are intuitive because of the nature of digital assets. There are also traders who use coin-margined futures to hold cryptocurrencies for the longer term. We should embrace these facts, as it helps strengthen our industry’s standing,” says Changpeng Zhao (CZ), Founder and CEO of Binance.

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