From Holding to Hedging: How to Choose Between Spot and Futures Trading in Crypto

Many traders begin their crypto journey with spot trading — simply buying and holding assets in hopes of price appreciation. However, as traders gain experience and seek to manage risk and profit in all market conditions, they turn to futures and other derivatives.

Spot Trading: Simplicity and Long-Term Strategy

Spot trading is the direct purchase or sale of cryptocurrency at the current market price. It’s straightforward and ideal for long-term investing. However, spot trading lacks leverage and limits opportunities for risk hedging.

Futures: Opportunities for Leverage Trading and Hedging

Futures contracts allow trading with borrowed funds (leverage), increasing potential profits (and risks).

Futures also provide tools for hedging — protecting positions from adverse market moves. This is particularly valuable for institutional investors and professional traders.

Why Choose Deribit for Futures and Options Trading?

Deribit is one of the most popular platforms for trading crypto derivatives, especially BTC and ETH.

Here are key advantages that make Deribit an excellent choice:

• High Liquidity — Deribit has the largest market for BTC and ETH options, enabling fast order execution and tight spreads.
• Low Fees — Some of the most competitive rates on the market, crucial for frequent traders.
• Wide Range of Instruments — Beyond futures, Deribit offers European-style options with physical settlement, expanding hedging and strategy possibilities.
• Powerful API and Algo Trading Support — Ideal for professionals and automated trading.
• Security and Stability — High-level asset protection and platform reliability, even under heavy loads.

If you are a beginner or prefer long-term investing, spot trading is a solid choice.