In the fast-paced world of trading, the boundaries between investors and speculators are disappearing, and Binance Futures emerges as a means of making amazing profits. This carefully designed financial instrument gives traders the ability to anticipate the future and enhance their portfolios in an amazing way, from hedging risks to technical speculation. So, in this article, you will discover how Binance Futures can become a fast track to financial success, the inner mechanics of futures, and we will discuss profitable trading strategies and review expert advice to get the most out of this unique investment opportunity. So, let’s dive into the depths of this dazzling world of Binance Futures together. So, stay close and read what has been written carefully.
What are Binance Futures?
It is a type of financial agreement between two parties to buy or sell a commodity, currency, or other financial instrument at a predetermined price on a specific date in the future. It is worth noting that this differs from the traditional spot market, where trades are settled immediately. However, in the futures market, a contract is traded that specifies settlement at a future date, without the need for an immediate exchange of assets.
In this context, traders do not directly buy or sell commodities or digital assets, but instead, they trade a contractual representation of these assets; meaning that the actual trading of assets or money occurs in the future when the contract is executed. It is worth noting that this type of trading is usually used to hedge against price fluctuations, or to speculate on future market movements.
Example
Let’s take an example of Binance futures contracts for a physical commodity, such as wheat or gold. In some traditional futures markets, contracts can be for physical delivery, meaning that the physical commodity must be delivered at the end of the contract. This requires storing and transporting the commodity, which adds additional costs known as holding and transportation costs.
However, many futures markets today use cash settlement, where the contract is settled in cash equivalents rather than actual delivery of the goods; this means that no physical exchange of goods takes place.
In addition, the price of a commodity in the futures market can differ from its price in the spot market. It is worth noting that this difference depends on how far away the contract settlement date is. The larger the time gap, the higher the costs of holding and transporting, and the greater the uncertainty about future prices, which leads to an increase in the potential gap between prices in the spot market and the futures market.
How to trade Binance Futures?
Trading Binance futures requires following a set of basic steps and procedures to ensure a safe and effective trading experience. Here are the main points that you should know and do to be able to do so:
Create an account on the Binance platform
The first step is to create an account on the Binance platform. It is worth noting that the registration process is simple and only requires providing an email and password. Once the account is confirmed, you can enter the platform.
KYC Verification Procedures
Since Binance is a centralized platform, it is subject to financial laws that require users to conduct identity verification (KYC). It is worth noting that there are two levels of KYC, which are:
Level 1: After passing it, you can use the platform without major problems.
Second: This level allows you to withdraw and deposit larger amounts of money.
It is worth noting that completing the KYC process requires providing personal information, such as: passport or national ID, in addition to proof of residence.
Deposit money
Once you have created an account and passed the KYC procedures, you can then deposit funds into your Binance account via several methods, which are as follows:
Bank card: You can link your bank card to the account and deposit money, knowing that you will pay a fee of about 2% on purchases.
Bank Transfer: This method is convenient, especially if you are in the UAE, as you can transfer funds from your bank account to your Binance account.
P2P Market: It is one of the largest markets in the world of digital currencies, and through it you can buy digital currencies directly from other users.
Transfer cryptocurrencies to Binance account
If you have cryptocurrencies on another platform or wallet, you can easily transfer them to Binance, as you only need the address of the appropriate network on Binance. It is worth noting that there are different wallets on the platform for each type of trading:
Spot Wallet: For instant cryptocurrency trading.
Funding wallets: for funds you buy via P2P marketplace.
Futures Wallet: For trading Binance futures.
Transfer money between different wallets
After purchasing cryptocurrencies via P2P, the funds will arrive in the Funding wallet, where you can transfer them to the Futures wallet via an internal transfer. It is worth noting that if you purchase cryptocurrencies directly via fiat currencies, you can transfer them from the Spot wallet to the Futures wallet. You can also transfer the cryptocurrencies sent to you to the Futures wallet after they arrive in the Spot wallet.
How much are the trading fees on the Binance platform?
Binance charges different fees on trading transactions based on the type of order used as follows:
Maker requests
A “maker” is someone who adds liquidity to the market by placing pre-determined buy or sell orders in the order book at specific prices. For example, if the current price of Bitcoin is $60,000 and a trader places a buy order at $59,000, he is a liquidity maker.
Makers typically charge lower fees than takers because they help stabilize the market by adding depth to liquidity.
Taker requests
A taker is a person who takes liquidity from the market by executing buy or sell orders at the current market prices. For example, if a trader buys Bitcoin at its current price of $60,000 directly, he is a taker.
Taker fees are usually higher than maker fees because they remove liquidity from the market.
Reduce fees using BNB coins
Binance traders can reduce fees by using Binance Coin (BNB) to pay trading fees. When using BNB to pay fees, the trader gets a special discount. The more BNB held and the total trading volume, the higher the discount percentage that can be obtained. It is worth noting that this option is optional, but it can be very useful for active traders who are looking to reduce trading costs.
Competitive fees and special offers
Trading fees on Binance are very competitive compared to other platforms, in addition, sometimes Binance offers special offers, such as: zero-fee trading on specific trading pairs, including: Bitcoin in some cases.
Are futures contracts on Binance halal or haram?
Binance futures trading is a topic that raises wide controversy in jurisprudential and economic circles, as opinions differ on its ruling, for several reasons related to the nature of these contracts and the conditions that govern them. The most important points that must be taken into account when evaluating the ruling on futures trading can be summarized as follows:
Avoiding usury: Avoiding usury is one of the basic conditions for trading futures contracts, as these contracts must be free of any illegal interest; to ensure their compliance with Islamic law.
Example: These contracts must be part of a stable economic system, and not cause unwanted fluctuations in the market.
Time limit: Futures contracts must not only be in writing, but the specific time for executing the contract must be clearly specified.
Social benefit: Binance Futures trading should have a positive benefit to society, such as providing price stability.
Fraud Prevention: It is essential that this process is free from any form of fraud, and based on transparency and integrity.
in conclusion
It is worth noting that Binance Futures represents a qualitative leap in the world of digital trading, as it provides advanced tools and high flexibility for investors of all levels; so whether you are a professional trader seeking to make big profits, or a beginner looking to explore this field; Binance provides the ideal environment to achieve your goals, and with continuous innovations and strong support from the community, this platform remains at the forefront of developments in digital financial markets; making it an indispensable destination for anyone aspiring to succeed in this fast-paced world.
