If you have spent any time around crypto trading, you have probably heard people talk about "perps." Perpetual futures are the most traded product in crypto, and they are the core of Hyperbeat Trade. This guide explains what they are in plain language.
Hyperbeat Trade is built on Hyperliquid, the largest onchain perpetuals exchange, wrapped in Hyperbeat's own gasless, one-click interface. So the mechanics in this guide are exactly the ones Hyperliquid uses; Hyperbeat's job is to make them feel effortless.
The short version
A perpetual future is a contract that lets you speculate on the price of an asset without owning the asset itself. If you think the price of BTC will go up, you open a long. If you think it will go down, you open a short. Your profit or loss comes from how the price moves after you enter.
Two things make perps different from regular futures contracts:
- They never expire. You can hold a position for five minutes or five months.
- A mechanism called the funding rate keeps the perp price anchored to the real market price of the asset.
Longs and shorts
When you buy a perp, you are going long. You profit if the price rises and lose if it falls. When you sell a perp you do not own, you are going short. You profit if the price falls and lose if it rises.
This is one of the biggest advantages of perps over spot trading: you can express a view in either direction. On the spot market you can only profit when prices go up. With perps you can also position for prices going down.
Shorting also lets you hedge. If you already hold an asset on spot and want to protect against a drop without selling it, you can open a short perp of the same size. Losses on your spot holding are offset by gains on the short. Because Hyperbeat uses one unified balance for spot and perps, your spot holdings and the perp that hedges them live in the same account.
Leverage: trading with more than you have
Perps let you control a position larger than your deposit. This is called leverage, and it is expressed as a multiple.
Here is a simple example. You deposit 100 USDC and open a long on BTC with 5x leverage. Your position is now worth 500 USDC. If BTC rises 10 percent, your position gains 50 USDC, which is a 50 percent return on your 100 USDC. If BTC falls 10 percent, you lose 50 USDC, half of your deposit.
Leverage multiplies both directions equally. The money you set aside to back the position is called margin. On Hyperbeat Trade you can pick any leverage from 1x up to the maximum allowed for each market, and the order form always shows you the margin required before you confirm.
Liquidation: the risk that comes with leverage
Because you are trading with borrowed exposure, the exchange needs to make sure your losses never exceed your margin. If the price moves far enough against you, your position is closed automatically. This is called liquidation, and it usually means losing the margin backing that position.
The higher your leverage, the smaller the move needed to liquidate you. As a rough rule of thumb:
- At 2x leverage, the price needs to move roughly 50 percent against you.
- At 5x leverage, roughly 20 percent.
- At 20x leverage, roughly 5 percent.
The exact numbers are a little tighter than this because exchanges require a safety buffer called maintenance margin. Hyperbeat Trade shows your estimated liquidation price in the order form before you place a trade, and next to every open position. We cover this topic in depth in our guide to liquidation.
The funding rate: what keeps perps honest
Since a perp never expires and never settles into the real asset, something has to keep its price close to the actual market price. That something is funding.
At regular intervals, traders on one side of the market pay a small fee to traders on the other side:
- When the perp trades above the real price, longs pay shorts. This makes shorting more attractive and pushes the price back down.
- When the perp trades below the real price, shorts pay longs, which pushes the price back up.
Funding is a payment between traders, not a fee collected by the exchange. If you hold positions for days or weeks, funding can meaningfully add to or subtract from your results. Our funding rates guide explains how to read and use it.
Why traders use perps
- Trade both directions. Profit from prices falling, not just rising.
- Hedge what you own. Short a perp against spot you hold to protect against a drop without selling.
- Capital efficiency. Leverage means you do not need the full value of a position up front.
- No expiry. Hold as long as your margin supports the position.
- Deep liquidity. Perps are the most liquid markets in crypto, which usually means tighter spreads and better fills.
The risks, honestly
Perps are powerful, and they are also the fastest way for a new trader to lose money. Leverage cuts both ways, liquidations are permanent, and volatile markets can move faster than you can react. Start small, use low leverage, and always know your liquidation price before you enter a trade.
Where to go next
Hyperbeat Trade gives you perps and spot markets in one account, with no gas fees and one-click orders. When you are ready, these guides will take you from zero to your first trade:
- Getting started with Hyperbeat Trade
- Leverage and margin explained
- Understanding liquidation and how to avoid it
Nothing in this article is financial advice. Perpetual futures involve significant risk, and you should never trade with money you cannot afford to lose.
