What is the difference between perpetual and delivery futures on Gate.io?

Understanding Futures Contracts on Gate.io

Futures trading on Gate.io allows users to speculate on the future price of cryptocurrencies without owning the underlying asset. Two primary types of futures contracts exist on the platform: perpetual futures and delivery futures. Each serves a unique purpose and caters to different trading strategies. Understanding their structure is essential for effective risk management and position execution. The core difference lies in the settlement mechanism and whether the contract has an expiration date.

Perpetual Futures: No Expiry, Funding Rates Apply

Perpetual futures do not have an expiration date. Traders can hold positions indefinitely, making them ideal for those who want continuous exposure to an asset. However, to keep the contract price aligned with the spot market, Gate.io implements a funding rate mechanism. This rate is exchanged between long and short positions every 8 hours.

• If the funding rate is positive, longs pay shorts.
• If negative, shorts pay longs.
• Funding occurs automatically at 00:00 UTC, 08:00 UTC, and 16:00 UTC.

This ensures the perpetual contract price doesn’t deviate significantly from the underlying spot price. Traders must monitor funding rates closely, as frequent or high rates can erode profits or amplify losses over time.

Delivery Futures: Fixed Expiry, No Funding Fees

Delivery futures have a predetermined expiration date, such as quarterly or bi-weekly. These contracts settle automatically on the expiry date based on the average price of the underlying asset over a specified period (usually the last hour before settlement). Unlike perpetuals, delivery futures do not involve funding fees.

• At expiry, all open positions are settled in the base currency (e.g., BTC for BTC/USDT contracts).
• Traders must close or roll over positions before expiry to avoid automatic settlement.
• This structure suits traders with a specific time horizon or hedging needs tied to a date.

Because there is no funding mechanism, delivery futures reflect pure price movement expectations without the compounding effect of periodic payments.

Margin and Leverage: Similar Mechanics, Different Risks

Both contract types support cross and isolated margin modes, with leverage up to 100x depending on the pair. However, the risk profiles differ due to their structures:

• In perpetuals, funding rates can create unexpected costs or gains over time, especially during high volatility.
• In delivery futures, the main risk is price gap at expiry, where sudden market moves can lead to liquidation or unexpected settlement values.

Traders should calculate potential funding costs for perpetuals and monitor time decay for delivery futures. Gate.io’s margin calculator can help estimate liquidation prices and required collateral for both types.

How to Switch Between Perpetual and Delivery Futures on Gate.io

Gate.io separates these contracts in its Futures interface. To trade either:

• Navigate to the Futures section on the Gate.io website or app.
• Select Perpetual or Delivery from the top menu.
• Choose your trading pair (e.g., BTC/USDT).
• Set your order type (limit, market, stop-limit, etc.).
• Confirm margin mode and leverage before placing the order.

Note: Positions in one type cannot be transferred to the other. If you open a BTCUSDT perpetual contract, it cannot be converted to a BTCUSD quarterly delivery contract. Always double-check the contract name and expiry (if applicable) before trading.

When to Use Perpetual vs. Delivery Futures

The choice depends on your strategy:

• Use perpetual futures if you want:

  • Long-term directional bets without worrying about expiry.
  • Scalping or day trading with no need to roll positions.
  • Exposure that closely tracks spot prices via funding alignment.

• Use delivery futures if you want:

  • Defined risk within a time window (e.g., hedging a future BTC purchase).
  • No funding cost exposure.
  • Arbitrage opportunities between perpetual and delivery prices as expiry approaches.

Gate.io displays both types clearly, so traders can compare open interest, funding rates (for perpetuals), and time to expiry (for delivery) in real time.

Frequently Asked Questions

Q: Can I hold a delivery futures contract past its expiry date?No. Delivery futures are automatically settled at expiry. If you do not close your position manually, Gate.io will settle it based on the final settlement price, and any profit or loss will be reflected in your account.

Q: How often is the funding rate updated for perpetual futures?Funding rates are updated every 8 hours—at 00:00 UTC, 08:00 UTC, and 16:00 UTC. You can view the next funding time and rate in the contract details section on Gate.io.

Q: Is there a fee to switch from isolated to cross margin in delivery futures?No. Switching between isolated and cross margin modes is free. However, the margin requirements and liquidation risks differ between the two, so review your position carefully after switching.

Q: Do both perpetual and delivery futures support stop-loss and take-profit orders?Yes. Gate.io allows you to set stop-loss and take-profit orders for both contract types. These are executed based on the last traded price and help manage risk without constant monitoring.