A comprehensive beginner's guide to trading on Binance Futures. Learn key concepts, risks, fees, and how to place your first trade.
A futures contract is an agreement to buy or sell a cryptocurrency at a predetermined price at a specific time in the future. Unlike spot trading where you buy and own the actual asset, futures let you speculate on price movements without owning the underlying cryptocurrency. On Binance Futures, you will mostly encounter perpetual contracts — these have no expiration date, so you can hold positions as long as you want as long as you maintain enough margin. With futures, you can profit from both rising prices by going long and falling prices by going short. On spot markets, you can only profit when prices go up.
Long vs Short: Long (Buy) means you profit when the price goes up. Short (Sell) means you profit when the price goes down. Leverage amplifies your position. With 10x leverage, $100 controls a $1,000 position. This magnifies both profits and losses. Margin Modes: Isolated margin limits risk to only the margin allocated to a position, which is safer for beginners. Cross margin uses your entire futures balance as margin. Liquidation occurs when the market moves against you enough that your margin cannot cover losses, and your position is automatically closed.
USDS-M (USDT-margined) contracts are settled in stablecoins like USDT or USDC. They are the most popular and easiest to understand as profits and losses are denominated in dollars. Best for beginners. COIN-M (Coin-margined) contracts are settled in the cryptocurrency itself, such as BTC, and are useful for holders who want to earn more of their asset.
With leverage, you can lose your entire investment in minutes. A 10x leveraged position only needs a 10% adverse move to wipe out 100% of your margin. Higher leverage means faster liquidation. Crypto markets are extremely volatile with prices swinging 10 to 20 percent in a single day. Combined with leverage, even small price movements can cause massive losses. Liquidation cascades occur when many positions get liquidated at once, accelerating the price move and causing more liquidations. Funding rates are charged every 8 hours on perpetual contracts and can eat into profits. Emotional trading driven by fear and greed leads to impulsive decisions and is the number one reason beginners lose money. Studies suggest that 70 to 80 percent of retail futures traders lose money.
Step 1: Create a Binance Account. Go to binance.com and click Register. Sign up with your email or phone number and create a strong unique password. Step 2: Open a Futures Account. Navigate to Binance Futures and click Open Account. You will need to pass a short quiz about futures trading basics. Step 3: Complete Identity Verification (KYC). Submit your government-issued ID and complete facial verification. Step 4: Fund Your Account. Deposit fiat currency via bank transfer or card, or transfer crypto from another wallet. Then transfer funds from your spot wallet to your futures wallet.
Choose USDS-M Futures with a popular pair like BTCUSDT. Select Isolated margin mode for your first trade. Start with 2x to 5x leverage maximum as a beginner. Choose your order type: Market Order executes immediately at the current price, Limit Order executes only at your specified price, and Stop-Limit Order triggers a limit order when price hits a certain level. Set a Take Profit price to lock in gains and a Stop Loss price to limit downside. Always use a stop loss. Click Buy/Long or Sell/Short and monitor your position.
Never risk more than 1 to 2 percent of your account on a single trade. Always use a Stop Loss. Start with low leverage of 2x to 5x. Use Isolated Margin mode. Do not chase losses. Keep a trading journal recording every trade. Practice on mock trading first before risking real money.
Maker Fee is 0.0200% for limit orders that add liquidity. Taker Fee is 0.0500% for market orders that remove liquidity. Funding Rate is variable and paid or received every 8 hours. Pay fees with BNB for up to 25% discount. Use limit orders instead of market orders to save on fees.
Leverage: Borrowing funds to increase your trading position beyond your actual capital. Margin: The collateral required to open and maintain a leveraged position. Liquidation: Automatic closure of your position when your margin is insufficient to cover losses. PnL: Profit and Loss. Funding Rate: A periodic payment exchanged between long and short traders. Mark Price: A fair price calculated using spot price and funding rate. Take Profit: A preset price at which your position automatically closes to lock in profits. Stop Loss: A preset price at which your position automatically closes to limit losses. Open Interest: The total number of outstanding futures contracts. Perpetual Contract: A futures contract with no expiration date.
Digital asset prices are volatile. The value of your investment can go down or up, and you may not get back the amount invested. This content is for educational purposes only and does not constitute financial or investment advice.