XRP futures are exchange traded financial contracts that do not require you to own XRP in order to speculate on the future price of XRP. These are contracts that allow the investors to agree to buy or sell XRP at a fixed price on a futures date. The U.S. Commodity Futures Trading Commission (CFTC) regulates them and has a form of oversight and structure that appeals to many investors and is also a welcome invitation to those with trepidations about the associated risks of unregulated platforms .
Types of XRP Futures Contracts
There is a separate Coinbase Derivatives that offers two types of XRP futures contract:
Each contract of Nano XRP Futures means 500 XRP and will be traded in U.S. dollars in cash. Notably, these are put together for retail traders as well as smaller institutions and their capital requirements are lower as they give exposure to the price changes of XRP.
USD Settled futures on standard XRP futures deliver 10 XRP for every one XRP traded, and through each contract, 10,000 XRP are delivered for 10 USD. These are meant for large institutions, active traders.
Both types of contract are cash settled, so the difference between the entry and exit price will be calculated at contract expiration, and profits or losses are settled in USD without handling XRP tokens.
Advantages of Trading XRP Futures
Futures: Futures magnify your leverage to a greater position using a smaller amount of capital (also increasing your losses and your gains):
Futures can be used to protect your portfolio if you already have XRP and think short term volatility.
Futures allow you to speculate in placing both long (bullish) or short (bearish) positions, so you potentially can profit with either direction price movement.
Requires No Wallet: Since futures are traded on exchanges they have no need for wallets or managing of private keys.
Futures markets are usually highly liquid, so it is easier for you to enter long or short a position.
How to Invest in XRP Futures
To start trading XRP futures:
Pick an Exchange: A regulated exchange that gives XRP futures among them being Coinbase Derivatives.
Go to an Account: Create an activation code, register and any other verification processes.
Deposit Funds: Deposit funds into your trading accoun , this is the first step to complete.
Choose Contract Type: If investing by trading Standard XRP futures, select Nano for trading Nano, select Standard XRP futures.
Go Long or Short: Based on your market outlook place your trade and go long or short.Always possess market awareness yet you must monitor and manage.
XRP futures may be potentially profitable but they can also be potentially very risky in particular if leveraging is involved. To have this one has to know how to work with futures and to use good risk management practices.
