Chainlink Futures & Perpetual Guide: Trade LINK Futures On Delta Exchange

Understand what LINK futures are and how to use the leverage in futures to amplify your trading gains

Interested in trading Chainlink futures with Delta Exchange?

LINK Contracts Listed on Delta Exchange

Chainlink futures enable you to take long (you profit when market goes up) and short positions (you profit when market goes down) on LINK. Futures have in-built leverage which acts as a multiplier to your returns. Currently, the following Chainlink contracts are listed on Delta Exchange.

Chainlink Perpetual100x

Buy

Sell

LINK Futures Contract Details

Contract Name	LINKUSD
Description	Chainlink Perpetual
Max. Leverage	100x
Margin Currency	USD
Taker Fees	0.05%
Maker Fees	0.02%
Contract Type	perpetual futures

What is Chainlink Futures Trading?

Chainlink Futures is an agreement between two parties to buy or sell Chainlink at a predetermined future date and price. The futures contract derives its value from the underlying cryptocurrency, Chainlink in this case. Thus the price of a Chainlink futures contract moves broadly in sync with the price of Chainlink.

Trading futures is thus an alternative to actually buying or selling the underlying crypto (aka spot trading). In spot trading, you can make profit by buying Chainlink low and selling it at a high price. This trade however works only in a bull market, i.e. when Chainlink price is going up. However, in a bear market, there is no trade possible in spot trading. Furthermore, leverage trading is not possible in spot trading.

Trading Chainlink through futures offers several advantages over spot trading of Chainlink, namely ability to both long or short and get access to leverage.

Trade profitably in all market conditions

You can profit from rising LINK price by going long Chainlink futures. And, when LINK price is falling, you can make profits by going short. This feature of futures trading enable you to navigate all types of market conditions profitably. Compare this with directly buying Chainlink. When price is falling, you can either sell your Chainlink or suffer losses. In spot trading, there is no way of profiting from falling prices.

Hedge Price Risk

If you are a HODLer, you can still use futures to mitigate price risk. Say, you hold LINK. You can mitigate the risks you face when Chainlink is falling by going short LINK futures. In this case, a short futures position acts as a downside protection by effectively locking the $ value of your portfolio without the need for selling your Chainlink. Judicious use of futures as hedge can make you a better and stronger HODLer.

Amplify trading gains with leverage

Leverage enables you to open positions that are bigger than your trading capital. If you can open a position that is 10 times bigger than your trading capital, then you have 10x leverage available to you. The maximum allowed leverage for futures listed on Delta Exchange is as high as 100x. There are two ways of thinking about leverage:

Leverage as capital efficiency driver: For opening a position of a given size, higher the leverage lower the trading capital required. The leverage in spot trading is always 1x, while it is 3-4x in margin trading. This means futures is 20 to 100 times more capital efficient than spot or margin trading.
Leverage as a returns amplifier: Because in a leverage trade position size is greater than the capital deployed, impact of prices moves gets magnified. The return on capital deployed is leverage times the price return. This means that you can amplify your trading gains the effective use of leverage.