A perpetual swap is a type of derivative contract commonly used in cryptocurrency trading, allowing traders to speculate on the price of an asset without owning it. Unlike traditional futures contracts, perpetual swaps have no expiration date, enabling positions to remain open indefinitely as long as margin requirements are met. This flexibility, combined with leverage options, makes perpetual swaps a popular tool for hedging and speculative strategies. Traders are also attracted to the mechanism of funding rates, which ensures the price of the perpetual swap stays aligned with the underlying asset's spot price.
