Perpetual Futures vs Quarterly Futures: Which Crypto Derivative Fits Your Strategy?

When you trade crypto derivatives, you’re not buying Bitcoin or Ethereum-you’re betting on their price. And two contracts dominate this space: perpetual futures and quarterly futures. They both let you go long or short without owning the asset, but they’re built for completely different kinds of traders. Pick the wrong one, and you could be paying hundreds in fees you didn’t see coming-or missing out on a better setup for your strategy.

Perpetual Futures: No Expiration, But a Hidden Cost

Perpetual futures have no end date. You can hold them for days, weeks, or even years-no need to roll over contracts or worry about expiration. That’s why they’re the go-to for day traders, scalpers, and anyone who wants to react instantly to price swings. You can open a position at 3 a.m. on a Sunday, and no one’s going to force you to close it.

But there’s a catch: funding fees. Every eight hours, the exchange calculates a payment between long and short traders to keep the contract price tied to the actual spot price of Bitcoin or Ethereum. If you’re long and funding rates are positive, you pay shorts. If you’re short and rates are negative, you pay longs. It’s not a fixed fee-it moves with the market. On a volatile day, you could pay 0.05% every eight hours. That adds up to 0.15% per day, or over 5% a month. For a $10,000 position, that’s $500 a year just in fees-no price movement needed.

These fees aren’t random. They’re designed to prevent perpetual contracts from drifting too far from the spot price. If perpetuals trade at $70,000 while Bitcoin is at $68,000, longs pay shorts to bring the price back down. It’s a self-correcting system, but it’s also a cost you can’t ignore if you hold positions long-term.

Quarterly Futures: Set It and Forget It (Until It Expires)

Quarterly futures expire every three months-on the last Friday of March, June, September, and December. So if you open a BTC quarterly contract in January, it’ll expire on March 28, 2025. No more, no less. You can’t hold it past that date. But here’s the big win: zero funding fees.

That’s why professional traders, hedge funds, and long-term investors prefer quarterly contracts. If you’re holding a Bitcoin position for six months to hedge against a market dip, you won’t get drained by daily fees. You pay a one-time premium when you open the trade, and that’s it. No surprises. No overnight fee calculations. Just clean exposure.

These contracts also settle in Bitcoin, not USDT or USD. So if you’re long a BTC quarterly contract and it expires in-the-money, you don’t get cash-you get actual Bitcoin. That’s a big deal if you’re trying to accumulate the asset without buying it directly on an exchange. It’s a stealth way to build your stack.

Levelling the Playing Field: Leverage and Margin

Both contract types offer leverage-often up to 100x on some platforms. But the margin requirements differ. Perpetual futures usually require higher initial margins because of their constant price volatility and funding risk. Quarterly contracts, being more stable and predictable, often allow lower margin requirements. That means you can control the same size position with less capital upfront.

But here’s the trade-off: higher leverage on perpetuals means faster liquidations. If the market moves 5% against you on 20x leverage, you’re out. Quarterly contracts are less prone to sudden liquidations because they’re priced closer to spot and don’t have the funding fee distortion. That makes them safer for beginners who want to hold without micromanaging their positions.

Liquidity and Market Depth

Perpetual futures dominate trading volume. On Binance, Bybit, and OKX, the perpetual BTC/USDT pair trades more than 10x the volume of the quarterly contract. That’s because of the 24/7 nature of crypto and the flexibility of perpetuals. More traders = tighter spreads = better entry and exit prices.

Quarterly futures have lower volume, but they’re still deeply liquid-especially around expiration dates. That’s when institutional traders move in to close positions or roll them over. If you’re trading large sizes, quarterly contracts can still offer excellent execution, especially near the end of the quarter.

Who Should Use Which?

If you’re a day trader, swing trader, or scalper who opens and closes positions within hours or days-go with perpetual futures. The liquidity, speed, and 24/7 access are unmatched. You’ll pay funding fees, but if you’re not holding past 24 hours, those fees are negligible.

If you’re holding for weeks or months, hedging a portfolio, or trying to accumulate Bitcoin without buying it outright-choose quarterly futures. No funding fees. No surprises. Just clean, long-term exposure.

Some traders use both. They’ll hold a long-term position in quarterly futures to avoid fees, then use perpetuals for short-term trades on the same asset. It’s a hybrid strategy that gives you flexibility without the cost bleed.

What Happens When Quarterly Futures Expire?

You have three choices:

1. Close your position before expiration-this is the safest move.
2. Rollover to the next quarter-sell your current contract and buy the next one, locking in your profit or loss.
3. Let it expire-your position settles automatically in Bitcoin, and you’ll receive the difference between your entry price and the final settlement price.

Most retail traders close or rollover. Letting it expire can be risky if you don’t have the Bitcoin to receive-or if you didn’t plan for the tax implications. Settlement isn’t instant; it can take 24-48 hours. And if you’re short and the price spikes at expiration, you could owe more than you expected.

The Bottom Line: It’s About Time and Cost

Perpetual futures are for speed. Quarterly futures are for savings. One gives you freedom to trade anytime. The other gives you freedom from fees.

Ask yourself:

• Are you holding longer than a week? Then quarterly futures probably save you money.
• Are you trading multiple times a day? Perpetuals give you the edge.
• Do you want to end up with actual Bitcoin? Quarterly contracts settle in the asset.
• Do you hate checking your funding rate every 8 hours? Then avoid perpetuals.

There’s no ‘better’ contract. Only the one that fits your rhythm. Most traders stick to one type because they don’t realize the other even exists. Don’t be one of them. Understand the cost structure. Know your time horizon. And trade smarter-not harder.