Binance Crypto Derivatives - How to trade Binance Derivatives in Hong Kong
          

What is Binance? 

Binance is one example of how it is possible to achieve overwhelming success despite fierce competition and not only achieve but also maintain a leading position for a long time. It is important to clearly understand what is needed for this, competently organize the work process and not be scattered on trifles.

It has everything you need for successful trading:

  • Large selection of cryptocurrency pairs
  • Convenient interface
  • An extensive set of tools for market analysis
  • Decent depth of the order book
  • And most importantly, very low commissions for trading operations
  • Reliable protection system
  • Fast execution of transactions
  • High liquidity

Now Binance derivatives trading platform is one of the best not only in terms of trading volume, but also in terms of the number of supported coins. Many traders note liberal withdrawal limits, a convenient trading terminal, and other nuances. pairs with various cryptocurrencies without involving fiat money, but recently this approach is beginning to change, and exchange representative offices make it possible to trade in pairs with local currencies.

Binance cryptocurrency derivatives are acquired by a large number of users of this exchange.

Binance
Binance

What are derivatives?

A cryptocurrency derivative is a contract for the purchase or sale of a certain number of digital coins. When a trader buys a cryptocurrency derivative, he is not obliged to buy the amount of cryptocurrency specified in the contract. The trader interacts with a stock trader who sells or buys this contract from him at a nominal price. The difference between the nominal and the current (spot) price is the trader's profit or loss.

Derivatives are financial products whose value is tied to another asset.

Binance derivatives are gaining momentum in sales every day.Derivatives are contracts entered into between multiple parties to buy or sell an underlying asset. The price of such a contract is determined by the price of the underlying asset. Derivatives are traded primarily on a regulated market, but over-the-counter trading is also common, which is directly related to cryptocurrencies. Derivatives allow traders to share risks using a hedging mechanism. Hedging is understood as an agreement between the buyer and the seller on the invariability of the terms of the transaction (often the price) for a certain time. Thus, knowing in advance the price at which the asset will be sold, the participants in the transaction reduce the risk of price fluctuations in the future. The ability to reduce risks is a valuable property of derivatives. In the cryptocurrency market, price fluctuations are high and little unpredictable. Weak regulation, extensive scope for abuse, and technological complexity increase the risks of cryptocurrencies. The usefulness of derivatives increases and attracts additional players to the cryptocurrency markets. Trading cryptocurrency derivatives does not require the actual acquisition of the volumes of cryptocurrency specified in the contracts, so the amount of collateral for such operations is significantly lower than when trading the assets themselves. Traders earn on changes in the price of the underlying asset. Since the future market price of the underlying asset is unknown, all bidders assume the risk. If at the time of the execution of the contract the goods have fallen in price, then the seller receives a profit, and the buyer remains at a loss. If the price of a product goes up, then the buyer wins.

Derivatives market on Binance
Derivatives market on Binance

How does cryptocurrency derivatives trading work? 

The word “exchange” is usually associated with trading in shares and other securities or various currency pairs (dollar to ruble, euro to dollar, etc.). Therefore, from the phrase “cryptocurrency exchange”, most often, there is an image of a certain platform where you can buy or sell crypto. The crypto industry has changed very dynamically, and with it, cryptocurrency exchanges have acquired new features and functionality traders as a means of speculative earnings, allowing you to profit not only from the growth, but also from the fall in the value of assets. Since cryptocurrency derivatives are mostly a means for speculation, they are traded on the Binance exchange by default with additional leverage.

Below is information on how to trade futures on this exchange.

The mechanism of work: a trader opens a Short (short) position if he predicts a fall in the foreseeable future of the quotes of the selected crypto asset. Or a Long (long) position when the rate is expected to rise. Binance cryptocurrency derivatives trading platform offers its clients several types of pending contracts - USDⓈ-M and COIN-M. Both options are perpetual and deliverable (quarterly) futures, but the first type is settled in USDT or BUSD stablecoins.

  • You need to create an account on Binance Futures for trading pending contracts by going to the section through the “Derivatives” section.
  • We replenish the futures account with any cryptocurrency that the service supports - it will be used as margin collateral.
  • Select the type of contracts.
  • Determine the amount of leverage. Binance offers leverage for these financial instruments.
  • We open positions, having previously studied the dynamics of the market. In order to open one or another position, we use traditional orders for spot trading - limit or market.

Again, from a technical point of view, everything is simple. 

Binance cryptocurrency derivatives trading brings good earnings to its users.

Trade crypto futures
Trade crypto futures

How to trade Binance Derivatives in Hong Kong? 

Binance derivatives in Hong Kong is very popular, as in many other countries.

Initially, before proceeding to one or another trading method, you need to register on the service, go through verification in order to gain access to all products and functionality of the crypto exchange. Additionally, secure your account by enabling 2F authentication. Top up your balance with any cryptocurrency or fiat supported by Binance - a direct transfer from your personal wallet to the platform account when it comes to digital assets. Or deposit funds through Visa / MasterCard cards, popular payment systems, if replenishment is carried out in a traditional currency. After authorizing the account, the trader will see (the top line of the monitor) Binance offers. In the top line of the menu of the personal account, next to the "Trading" section, there is the "Derivatives" heading, which includes, among other offers, trading with pending contracts - futures. Choose the one option that suits the needs and start trading.

Binance derivatives trading is carried out around the clock and on a daily basis.

Binance trade room
Binance trade room

How to register ? 

Registration on the Binance exchange begins by clicking the appropriate button on the main page of the official website.

  • Initially, a window with a registration form will pop up, where you will need to choose the option to create an account (via email or by phone).
  • Decide what suits you best and fill out the form with your email address/mobile number and password, which should contain: At least 8 characters in any layout; At least 1 capital character; At least one number. In general, the more difficult, the it is better!
  • After filling out the form, click create an account and a 6-digit confirmation password will be sent to your mailbox or phone, depending on which method of registration on Binance was chosen.
  • Enter it in the pop-up window for verifying the email address (mobile number) and the system will redirect the account to the Binance website.

On the main page, you will immediately be offered options to replenish the deposit with virtual coins or fiat, as well as a reminder of additional account protection measures. It is highly recommended to enable 2FA.

Create an account
Create an account

List of Binance Derivatives 

Binance crypto futures trading will help you achieve all your goals.

Margin trading is a higher-risk trading that involves borrowing money. This type of trading on the exchange is also referred to as “leveraged trading”, which allows traders to access more capital and raise their positions. In essence, margin trading increases trading results and allows traders to reap more profits from successful trades.

A quarterly futures contract is an agreement to buy or sell an underlying asset in the future at a predetermined price. By trading futures, traders can take part in the movement of the market and make a profit by taking a long or short position on a futures contract. Binance Futures Contracts are divided by delivery time into quarterly and perpetual futures contracts. Margin and futures trading allows you to increase profits through the use of leverage. Margin traders have access to leverage from 3x to 10x on the assets provided by the platform. The leverage ratio depends on whether you are using Isolated Margin or Cross Margin mode. Binance Futures and Binance Margin allow traders to switch between Cross Margin and Isolated Margin modes. In this way, traders can spread their funds between cross and isolated positions, separating the collateral wisely to control risk.Margin traders place orders to buy or sell cryptocurrencies in the spot market. This means that margin orders are matched against orders in the spot markets. All orders related to margin trading are actually spot.

Binance Margin allows users to borrow funds on the platform and calculates the borrowing rate for the next hour. Subsequently, users return the borrowed funds. Traders should pay attention to the sufficiency of assets in order to avoid liquidation.

The funding rate is only charged to traders when trading perpetual futures.

Binance Options are US-style options that can be exercised at any time up to the expiration date. Binance options are cash settled and therefore do not require physical delivery.

Unlike traditional options, Binance options have shorter expiration times ranging from 5 minutes to 1 day. Binance options have only one strike price, which is equivalent to the contract price on Binance Futures. In other words, Binance options are always in the money. The maximum loss for an option buyer is equal to the premium you paid. In this case, the breakeven point is the strike price +/- premium (depending on whether the contract is a call or a put). All trades are executed at the market price. There is no guarantee that the trade will be executed exactly at the price that was previously indicated on the screen, although usually the execution price is very close. The price of small orders or orders executed during a “calm” market (less volatile market) will always match almost exactly, but for large orders or orders executed during a volatile market, the price may deviate depending on the actual order execution price.

An option contract has the right to perform a certain action at a specific point in time in the future. The user who owns the Option (the Buyer) may exercise this right (favorable) or refuse it (unfavorable) before the expiration date at his own will. The seller of the option must comply with the buyer's decision.

The futures market in the crypto industry is a fast-growing sector, generating trillions of volumes every month. Like stock options or commodity futures, cryptocurrency futures provide protection against volatility and adverse fluctuations in cryptocurrency prices. In addition, this tool allows traders to speculate on the future price of a cryptocurrency. It can also be used to hedge cryptocurrency price changes.

Futures contracts are an integral part of the traditional financial system. These complex financial instruments are intended primarily for advanced and experienced investors. Investors, corporations, and governments use derivatives, including futures contracts, to protect against risk and asset price volatility.

Binance crypto futures have the following advantages:

  • Leverage: Gain access to a specific asset for a fraction of its value. Leverage allows you to amplify minor price fluctuations and make a profit that pays for your time and effort.
  • Flexibility: futures allow you to speculate on the price of a cryptocurrency and make a profit in a short time without buying an asset. You can open a position on a crypto futures contract in USDT; the resulting profit will also be calculated in USDT.
  • Liquidity: The cryptocurrency futures market is extremely liquid, with trading volume in the trillions. The risks in a liquid market are lower, traders can easily open and close positions with minimal risk of slippage.
  • Portfolio Diversification: Use different trading strategies to increase profits. Alternatively, you can develop complex trading strategies such as short selling, arbitrage, pair trading, etc.

Binance crypto futures in Hong Kong is widely known and has a lot of positive reviews.

Follow the derivatives information on the Binance blog
Follow the derivatives information on the Binance blog

Conclusion 

Most people who have heard something about Binance, but have not interacted closely with the functionality provided by this company, know Binance simply as the world's largest cryptocurrency exchange.

Binance is chosen for the following positive qualities:

  • Good reputation, large number of active users and liquidity. This is a guarantee that at any time it will be possible to quickly make a deal of the required volume.
  • Extensive selection of supported cryptocurrencies.
  • The speed and performance of the resource.
  • To work with small volumes, account verification is not required, the user has access to all the trading functionality from the very beginning.
  •  High level of safety, repeatedly proven in practice.

If you analyze the reviews about Binance, you can summarize, then you can say that this is one of the leading exchanges with profitable and functional trading of cryptocurrencies. The project is not a scam, the site is supported by large businesses and the number of clients is constantly growing.

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GENERAL RISK WARNING:
The financial services provided by this website carry a high level of risk and can result in the loss of all your funds. You should never invest money that you cannot afford to lose