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In the currency circle, many investors have a deep understanding of Bitcoin, but they may have only a vague understanding of the meaning of Bitcoin futures. Bitcoin futures are used to speculate on the price changes of Bitcoin, and investors who participate do not need to actually hold Bitcoin. The purpose of Bitcoin futures trading is not to obtain physical Bitcoin, but to transfer the price risk of the spot market through Bitcoin futures trading, so that investors can obtain risk profits from the price fluctuations in the futures market. I believe that many investors also want to know what the relationship is between Bitcoin futures and Bitcoin? The following is a detailed introduction by the editor of the currency circle.

 What is the relationship between Bitcoin futures and Bitcoin?

Bitcoin futures are an investment method based on Bitcoin. Bitcoin futures are a derivative contract whose price is based on the price trend of Bitcoin. Bitcoin is a digital currency with large price fluctuations, so some people hope to avoid risks or speculate through futures trading.

The difference between Bitcoin futures and Bitcoin is reflected in the fact that Bitcoin futures have margin, leverage, different trading objects and different settlement methods, while the price of Bitcoin futures is closely related to the price of Bitcoin, but does not directly affect the actual transaction price of Bitcoin. Bitcoin futures can provide investors with a tool for investment, arbitrage or risk management, but they need to pay attention to risks.

The trading principle of Bitcoin futures is that the buyer and seller agree to buy and sell a certain amount of Bitcoin at a specific price at a certain time in the future. If the actual Bitcoin price is higher than the futures contract price when the agreed time arrives, the buyer will make a profit; conversely, if the price is lower than the futures contract price, the seller will make a profit.

In futures contracts, Bitcoin can also be traded as an asset. The price of Bitcoin will be predicted by both the buyer and the seller. The futures market allows Bitcoin to be traded on regulated exchanges, which should theoretically attract more businesses and serious investors to enter this field, who have previously been put off by the lack of regulation.

 Bitcoin Futures Trading Precautions

For investors, there are many things to pay attention to when trading Bitcoin futures. Here are 4 Bitcoin futures trading precautions compiled by the editor of the currency circle:

1. Understand market risks

The Bitcoin futures trading market is highly risky. Investors need to have a full understanding of the market and contract characteristics before trading, and should not blindly chase ups and downs.

2. Avoid blind decision-making

When trading futures, investors need to make decisions based on factors such as the funds they hold, trading methods, and market trends, rather than blindly listening to the advice of others.

3. Pay attention to fund management

When trading Bitcoin futures, you need to plan your funds reasonably, and you should not over-leverage or suffer a large amount of principal loss. At the same time, use risk management techniques, set up trading rules such as stop-profit and stop-loss, and reduce trading risks.

4. Stay calm

When trading futures, you need to stay calm, not be affected by trading psychology, clarify the purpose of trading and risk tolerance, and not be overly greedy or fearful, so as to avoid losing rational decision-making due to psychological influence.

The above content is the detailed answer of the editor of the currency circle to the question of what is the relationship between Bitcoin futures and Bitcoin. The digital currency market is extremely unstable, and any investment has certain risks. Investors must understand the market characteristics and risks when trading Bitcoin futures, and master fund management skills to succeed in the digital currency market. When choosing a Bitcoin futures trading platform, it is necessary to comprehensively consider factors such as platform trading varieties, market data accuracy, platform trading mechanism, and platform security, especially the security of the platform is particularly important.