Binance is one of the most popular and largest crypto exchanges in the world offering the best crypto trading services to crypto traders. One of the most popular services offered by the exchange is futures trading. Binance futures seem to be a game-changer to the crypto trading world that allows traders to trade with leverage. It allows users to open both long and short positions for a variety of cryptocurrencies with leverage.
The Futures market available with the Binance trading platform are:
- USDT-margined: Perpetual contracts
- USD Coin-margined: Perpetual and Quarterly contracts
Binance Futures is an agreement between two parties to buy or sell Binance or other crypto assets at a predetermined future date and price. The futures contract derives its value from the underlying cryptocurrency, Binance in this case.
Futures trading could be profitable if a trader understands the market in the right way. Most of crypto traders spend years in trading without even understanding how the trading market works, and this leads to unsuccessful trading in future. With years of experience, the pro traders study the market smartly/aggressively, and as per their opinion, Futures trading is the best way to earn money in crypto trading.
In some cases, instead of actually buying or selling, future contracts allow traders to gain exposure indirectly to any cryptocurrency and potentially profit from the price movements. Growlonix is one the most popular crypto trading terminals that support Binance Futures trading via making use of APIs.
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Binance Futures Trading
Binance Futures is one of the leading futures crypto trading platforms with 20x leverage (previously it was 100x). Futures Trading allows traders to hedge against volatile markets and make sure that they buy or sell an asset at a set price in future. And, if the price moves in the opposite direction, they may end up paying more than the market price or selling it at a loss.
In futures trade, there is no actual exchange of assets which always takes place like normal trading. They only take advantage of the price changes and buy and sell the contracts in a short time and earn profits for themselves.
Getting started on Binance Futures trading is quite easier, but before opening an account on Futures, you must have a regular Binance account.
But, if you are new to the Binance platform, either install the Binance app on your system, or simply go to the Binance official website, and follow the below steps:
- Click on the ‘register’ tab
- Enter your email id and password
- Now click on the tab ‘create account’
- You will receive a verification code in your email soon. Now, follow the instructions here and complete your registration on Binance.
After opening your account on Binance, click on the Futures option at the top of your web page. Or you can also click on the Futures icon at the bottom of your home screen on the Binance app. Now, click on the tab open now, and here you go with the Binance Futures account.
Benefits of Binance futures trading
Trading Binance through Futures offers several advantages to the traders over spot trading:
- Trading profitably in all market conditions
The Futures trading allows traders to earn profits from the rising price of Binance by going long. And, you can also make profits whenever the price of Binance is falling by going short. This feature enables traders to navigate all types of market conditions profitably in Binance futures. And, on the other side, there is no way of profiting from the falling prices in spot trading.
In Binance Futures, the traders can enter positions which are larger than their current account balance. Perpetual future contracts can be traded with leverage which goes up to 100x which means a balance of $100 will allow you to trade with $10,000.
- Effective hedging mechanism and risk management
This was the main reason why Binance Futures were introduced. If you had $15,000 to trade, you might choose to invest long-term in Bitcoin, so you could buy $10,000 of Bitcoin and hold it on your account, essentially this is a “Long” position with no leverage and there is no risk of being “liquidated”. In cryptocurrency trading, no asset price will go up in value, the moment you buy it. Isn’t it? And, with the remaining $5000, you could take advantage of price declines to “short” Bitcoin with 3x leverage, giving you a total of $15,000 trading power to hedge your long position if the price falls.
The lower fee structure of Binance futures platform is one of the most attractive features. it allows you to earn profits regardless of the market conditions.
How to trade on Binance Futures?
To place trades on Binance Futures via third-party platform or directly, you have to go with the following steps:
- Firstly, you are required to select a crypto asset from the drop-down box under the main Menu. This will occupy the place order section of the platform with your chosen crypto coin.
- Secondly, select the trade order size and include take profit or stop-sell level if required.
- Finally, click the submit button, and the new trade will be visible in the open positions tab of your Binance Futures trading platform.
The traders can also use ‘Buy’ and ‘sell’ buttons in the price chart panel for quicker access. The specific trading parameters can also be chosen from the pop-up window which allows the traders to execute their trade. Binance Futures trading platform specializes in the trading of leveraged perpetual futures account. Once registered, the investors or traders can take both long and short positions on all the supported cryptocurrencies on the Binance platform.
Placing an order on Binance Futures:
Let’s have a look at the order form, and the fields which are required to be filled for a Futures order:
Here a BTC/USDT futures buy/long market order will be placed. While filling the order, make sure to keep these four things in mind:
- Enter your preferred order type
- Select a trading mode
- Adjust the leverage
- And, finally, you will find take profit/stop loss checkbox
Why expert traders prefer futures trading?
The spot market allows its traders to trade cryptocurrencies at any time, but it has some limitations. Investors are limited to buying cryptos with the capital they have, and there are times when they have to hold the asset for a while before taking profits. On the other side, futures trading allows traders to diversify their portfolios and increase their exposure to a variety of cryptocurrencies withholding any asset. The use of leverage further increases their capital efficiency as they do not have to lock up the entire capital to purchase large crypto.
Traders can go long or short to benefit from the volatile market movements in either direction while implementing different strategies offered on Binance Futures, including TWAP, Grid Trading, and more.
If you want to start trading on Binance Futures, you must follow the below steps:
- Deposit USDT, BUSD into the USD-M futures account as margin and other coins in COIN-M futures as margin.
- Select the leverage level like 10x, 100x, etc.
- Now choose the order type like if you wish to buy/sell
- Define the number of futures contracts that you want to own
Binance Futures trading allows its traders to trade with leverage/margin where they make use of the borrowed funds from Binance exchange to increase their trading position beyond what they could obtain from their available cash balance alone in their wallet.
While we all know that leveraged trading comes with inherent risks, traders who trade with leverage can earn good profits in a shorter period.
Let’s understand how it works:
If you buy BTC worth $100 and the exchange offers a leverage of 1:100, then you are trading with $10000, not $100. Any profit earned would be multiplied by 100.
While there are different ways to trade crypto with leverage, Binance Futures trading with leverage seems to be a game-changer.
Binance Futures trading with Growlonix
If you choose a personalized strategy to trade futures, you can not only automate it using Growlonix platform’s crypto trading bots but you can also earn more profits on it taking advantage of the leverage offered with Binance Futures. Using higher capital and then leveraging the capital can maximize your returns.
The Futures trading with crypto trading bot Binance at Growlonix lets the traders divide their capital into smaller parts and buy the asset at fixed intervals. You can either make a personalized strategy or the third-party strategies here.
With personalized trading, one may use technical indicators or any other tools, and automate trading of this strategy in Growlonix. To trade with leverage with your bot, you can connect your account directly at the exchange platform to Binance Futures. Once an appropriate exchange is connected successfully, the bot will activate the leverage functions.
In the third-party strategy, you can also automate trading with third-party crypto trading signals and then connect it to the Future exchange to use leverage.
To trade on Binance Futures with Growlonix, you have to choose the following settings in the correct place:
- Go to your Binance account>settings>manage API
- In API settings, check if you have enabled Futures trading permission for that API Key.
- In the preferences section, make sure to select the position mode as a one-way mode.
Futures trading can be lucrative if you have the proper knowledge and risk management techniques to avoid outsized losses. Thus, you should strategize first and do due diligence before trading futures and understand both their advantages as well as their risks.
What makes Binance Futures Trading stand out?
Advanced order types, time-weighted average price, trading with leverage, and advanced trading terminology is something that makes Binance Futures trading beneficial and popular among traders. But, grid trading feature is something that makes it stand out among the rest. Making use of grid trading bot automates the buying and selling process of futures contracts by placing orders at preset intervals within the configured price range.
One of the key benefits of using grid trading bot is that it allows traders to earn profits even from smaller price changes. The more grids are set, the higher is the frequency of trades, despite the lower profit margins for each trade.
With the different types of derivatives products along with an enormous variety of crypto trading pairs available, you can probably see why Binance Futures is the most preferred and a leading crypto derivatives trading platform among futures traders. Simply, automate your trades by making use of Binance futures trading bots on Growlonix, and experience risk-free and profitable trading.