The one real difference between perpetual and regular futures
A perpetual future never expires and leans on a funding rate to stay near spot, while a regular future settles on a fixed calendar date and converges to that date mechanically. Everything else, the leverage, the margin, the liquidation engine, is largely shared between the two.
The distinction is expiry and the mechanism that anchors price. A perpetual futures contract has no expiration date and uses a funding rate paid between longs and shorts to track the underlying, whereas a traditional futures contract settles to a fixed price on a fixed date and uses no funding rate at all.
I reach for perps when I want leveraged directional exposure with no expiry to manage, and I reach for dated futures when I am hedging an obligation that itself falls on a known date. Choosing the wrong one is usually a cost problem, not a catastrophe, but it is a cost you pay every time.
For the broader context of where these sit inside crypto derivatives, the crypto derivatives and leverage cluster covers perps, funding, leverage, and options side by side.
Perpetual vs regular futures, side by side
The two contracts share a margin and liquidation engine but diverge on the two things that decide your holding cost and your exit. The table below isolates those differences.
| Feature | Perpetual future | Regular (dated) future |
|---|---|---|
| Expiry | None | Fixed calendar date |
| Price anchoring | Funding rate, paid every 8 hours | Convergence at settlement |
| Cost to hold | Recurring funding payments | Roll costs at each expiry |
| Price vs spot | Held near spot by funding | Trades in contango or backwardation (the basis) |
| Typical use | Directional leverage with no expiry | Hedging a dated obligation |
I read the table as a cost map rather than a scorecard. Perps charge you continuously through funding, while dated futures charge you discretely each time you roll a contract forward, and the right choice depends on how long you intend to hold.
Funding rate vs the basis: how each stays near spot
A perp has no settlement date to force it back to spot, so exchanges invented the funding rate to do that job continuously. Investopedia's perpetual futures guide describes funding as the mechanism that keeps the contract price close to the actual spot price, paid between longs and shorts on a fixed schedule.
A regular future reaches spot the opposite way, and I find it cleaner: it converges mechanically as settlement approaches, because at expiry the contract settles against the underlying price. There is no funding payment because the expiry does the anchoring.
The practical result is that a perp's price hovers tightly around spot at all times, while a dated future can drift into contango, trading above spot, or backwardation, trading below it, until settlement pulls it back. That gap between the futures price and spot is called the basis, and it is the dated-future equivalent of funding.
Funding costs vs roll costs: what holding actually costs
The cost of holding a perp is the funding you pay every eight hours when you are on the crowded side, and it compounds against the full leveraged position. On a dated future there is no funding, but if you want exposure past the expiry you have to roll, closing the expiring contract and opening the next one, which incurs spread and slippage each time.
I compare the two by annualizing: a perp's funding rate turned into an annual drag versus the implied roll cost of a dated future over the same period. Whichever is cheaper for your intended hold wins, and the answer changes with market conditions.
In calm markets a dated future is often cheaper to hold for weeks because funding on a hot perp can run well into double-digit annual percentages. In fast-moving crypto markets the perp usually wins on liquidity and tight spreads, which is why perps dominate crypto volume while dated futures dominate traditional commodities.
Which to use when
Use a perpetual future when you want leveraged crypto exposure with no fixed horizon, because the continuous funding model fits an open-ended view and the perp market is the deepest pool of crypto liquidity. SEI's perps guide frames perpetuals as derivative contracts with no expiration that use funding to track the underlying, which is exactly the shape a directional crypto trader wants.
Use a regular future when your hedge or obligation has a known date, because a dated contract lets you match the exposure to the date and let convergence do the work. Commodity producers, importers, and institutions with calendar obligations use dated futures precisely because expiry aligns with their real-world timeline.
I keep a simple rule: if the trade has a natural end date, match it with a dated future; if it does not, use a perp and manage the funding cost. Most retail crypto traders live in the second case, which is why perps are the default instrument in this market.
Leverage and liquidation: the shared ground
I treat the risk mechanics as essentially shared, because both contracts run on margin and both can liquidate you when that margin falls below the maintenance requirement. The leverage you choose and the stop you set matter far more than which expiry structure you trade.
If the leverage decision is the bottleneck, the guide to the best leverage for crypto futures covers sizing from risk so liquidation stays theoretical, and the liquidation explainer covers what actually happens when it does not.