Perpetual Futures, or Perps, have become one of the most widely used tools in crypto trading. They offer flexibility, the ability to profit in both rising and falling markets, and access to leverage. But with all that power comes serious risk — especially for those new to trading.
In this article, we’ll break down the potential rewards of trading Perps, the hidden risks that can catch traders off guard, and when (or if) it makes sense to use them. If you’re considering trading Perps or just want to understand the landscape better, this guide is for you.
Not sure what Perps are? Start here: What Are Perpetual Futures in Crypto? A Simple Guide for Beginners
The Rewards of Trading Perps
Trading Perps gives you access to strategies that aren’t possible with regular spot trading. For experienced traders, these tools can be highly effective. Here’s what makes them appealing:
You Can Trade in Both Directions
With spot trading, you only make money when the price of a coin goes up. But Perps allow you to take long or short positions. That means you can profit when the market rises or when it falls. This flexibility is one of the main reasons why so many traders choose Perps over spot trading.
Leverage Allows Bigger Trades
Perps let you use leverage — essentially borrowing capital to open a larger position than your actual balance would allow. For example, with 5x leverage, a trader can turn $100 into a $500 position. If the market moves in your favor, the gains are multiplied. This is why leveraged trading is attractive to those looking for bigger returns in shorter time frames.
No Expiry Dates
Unlike traditional futures contracts, Perps don’t expire. This means you can hold your position for as long as your margin allows. It’s a simple structure that doesn’t require you to worry about contract rollovers or expiry dates, which often adds complexity in traditional markets.
High Liquidity on Major Pairs
Many Perps markets offer deep liquidity, especially for popular assets like Bitcoin, Ethereum, and Solana. This ensures tight spreads and faster trade execution — key factors for traders who rely on speed and precision.
The Risks of Trading Perps
Despite all the advantages, trading Perps carries serious risks — particularly for beginners. These are not simple buy-and-hold tools. They require strategy, discipline, and a strong understanding of market mechanics.
Leverage Works Both Ways
The same leverage that boosts your gains can also multiply your losses. A 5x position doesn’t just increase profit potential — it increases the speed and size of potential losses. For instance, if the market moves against you by just 20%, your 5x position can be completely wiped out. Many new traders learn this the hard way.
Liquidation Can Happen Quickly
If your position loses too much value and your margin falls below the required level, your trade will be liquidated. This means your position is automatically closed and you lose the collateral. Liquidation can happen within minutes during volatile conditions, especially with higher leverage. Without a solid risk management plan, liquidation is almost inevitable over time.
Funding Fees Can Eat Into Profits
Perps rely on a funding mechanism to keep prices in line with the spot market. Depending on whether you’re in a long or short position, and the current market sentiment, you may be required to pay or receive funding fees periodically (often every eight hours). Over time, these fees can add up — especially if you're holding a position for multiple days.
Emotional Trading Becomes a Trap
Perps introduce a new layer of pressure. The ability to win or lose large sums quickly can trigger emotional responses — like panic selling, revenge trading, or chasing losses. Without strong discipline and a clear plan, emotions often lead to bad decisions. Many traders lose money not because of the strategy, but because they act emotionally.
The Learning Curve Is Steep
From managing leverage and understanding liquidation levels to reading funding rate charts and setting stop-losses, Perps require much more than basic trading knowledge. Jumping in without proper education or preparation is a fast path to losses. It’s essential to understand how each element works together before you open your first trade.
Should Beginners Trade Perps?
Perps are powerful tools, but they are not beginner-friendly. If you’re still learning the basics of crypto markets or just getting comfortable with spot trading, it’s wise to hold off.
Instead, start by:
Practicing with small spot positions
Learning how to manage risk and use stop-loss orders
Studying how leverage and funding rates work in Perps
Once you’re confident with the fundamentals and comfortable navigating volatile markets, you can consider testing Perps using very low leverage — like 2x or 3x — and only with capital you’re willing to lose.
Blum Is Bringing Perps to Telegram Soon
The good news? Perps are becoming easier to access — and Blum is working on making them even simpler. Soon, you’ll be able to trade Perpetual Futures directly inside Telegram using Blum.
That means:
No more switching between apps or browser tabs
A streamlined experience for going long or short
Built-in leverage settings with safety reminders
Transparent, easy-to-read trade data
We’re designing this with both beginners and advanced users in mind — so whether it’s your first trade or your hundredth, you’ll have a smoother and more intuitive way to trade Perps.
Stay tuned for the launch.
Final Thoughts
Trading Perps isn’t gambling — it’s a high-risk, high-reward strategy that can work well if used responsibly. The biggest mistake most new traders make is underestimating the risk, overusing leverage, and failing to set clear boundaries.
If you treat Perps like a professional tool and focus on learning before chasing profit, they can become a valuable part of your trading strategy. But they’re not a shortcut to wealth. They require planning, patience, and emotional control.
Start slow. Learn the mechanics. Use low leverage. And never trade more than you can afford to lose.
