2 major Difference between spot and future trading ?
Spot vs Futures Trading - here's the lowdown:
- *Spot Trading*: You buy or sell crypto at the current market price, and the transaction is settled immediately. It's like buying something at a store with cash 💸.
- *Futures Trading*: You're trading contracts that promise to buy or sell crypto at a set price on a specific future date. It's like betting on the price of something in the future 📈.
*Key Differences:*
1. *Settlement*: Spot trading settles instantly, while futures trading settles on a future date.
2. *Leverage*: Futures trading often involves leverage (borrowed money), which can amplify gains and losses. Spot trading typically doesn't use leverage.