The good and the bad of perps, according to crypto traders
Perpetual futures, or perps, have become the core crypto derivatives product because they offer deep liquidity, low fees, and strong margin efficiency. Unlike dated futures, they do not expire, so traders avoid roll costs and can keep positions open indefinitely. For most altcoins, perps are often the only practical derivatives venue because spot markets are thin and dated futures are illiquid. Traders use perps for both institutional and retail needs: better fills, hedge mode, and the ability to hold long and short positions in the same token. Their 24/7 nature also means price discovery happens whenever news breaks, including during weekends and market closures. The main drawback is funding rates, a recurring cost that can rise or stay extreme for long periods and is hard to predict or hedge. Liquidations matter too, but the bigger structural risk is exchange margin design and loss socialization, not perps themselves.
