What is a perpetual contract？

The content of this article:

A perpetual contract is an "innovative" futures contract. Traditional contracts have an expiry delivery date, while a perpetual contract has no delivery date and users can hold a position forever. The contract is settled every 8 hours, at 00:00, 8:00, and 16:00 (GMT+8).

Monochrome offers modes of contract trading：

USDT-M contracts (forward contracts) support perpetual contracts and are settled in USDT.

Features of USDT-M contracts

Settle in Dollar-anchored assets: Contracts are priced and settled in USDT.

Clear pricing rules: each contract specifies the number of deliveries of a single contract's underlying asset, also known as "contract units."

Advantages of USDT-M contracts

The USDT-M contracts are linear contracts quoted and settled in USDT. The biggest advantage of settlement in USDT is the ease of calculating returns in fiat. This makes USDT-M contracts more intuitive. For example: 1 USDT is worth approximately $1, so after earning a profit of 500 USDT, you can easily calculate that the profit is about $500.

In addition, the universal settlement currency of USDT can significantly improve transaction flexibility. Multiple futures contracts can use the same settlement currency (eg: BTC, ETH, XRP, etc.) without having to buy the underlying token to fund the contract position. Therefore, there is no need for additional currency exchange when trading through USDT, which saves extra fees.

When the market fluctuates violently, USDT-M contracts can effectively reduce the risk of large price fluctuations. Therefore, there is no need to worry about hedging exposure to the underlying margin of the contract.