(and how it’s different from Perpetual Futures)

Imagine two playground games:

• Game A – Perpetual Futures (“Perps”): You can keep playing forever, as long as you keep paying a small “game fee” every few hours. You can stop any time.
• Game B – Dated Futures (Monthly Settlement): The game ends exactly in 7 days. On that day, your score is final whether you like it or not.

Both games are about guessing the future price of something. The difference? One has no timer, the other has a countdown clock. That timer changes how you plan every move.

1. Perps vs. Dated Futures at a Glance

Perpetual Futures

• ❌ No expiry
• Funding payments keep price near spot
• Funding fees every few hours
• You decide when to close
• Best for long-term trends, flexible hedges

Dated Futures (1 Week Settlement)

• ✅ Fixed expiry (last Friday of the month)
• Price naturally moves toward spot at expiry
• No funding fees
• Auto-settles at expiry
• Best for date-specific bets, precise hedging

2. The Analogy: Renting vs. Leasing

• Perps = Renting → You pay rent (funding) to stay in your position. You can leave whenever you want.
• Dated Futures = Short-Term Lease → You’ve signed for a week. At the end, you hand over the keys no matter what.

3. How Strategies Change

Let’s walk through the main trading strategies, using simple analogies so even a kid could follow.

A. Hedging

(Protecting Yourself)

• Perps: Like holding an umbrella forever. If it rains, you’re covered. If you want to stop, you just fold it. But you keep paying a tiny “umbrella fee” every 8 hours.
• Dated Futures: Like wearing a raincoat only on the day it will rain. Perfect if you know exactly when you’ll need it. If you have to sell your apples in a week, you pick a 1-week future to lock in today’s price and forget about funding fees.

B. Speculation

(Betting on Direction)

• Perps: Like surfing — you can ride the wave for as long as it lasts. If you think Bitcoin will keep climbing, you just hold your position and pay/receive funding.
• Dated Futures: Like entering a surfing contest where the judges score you exactly at 3 PM two weeks from now. Your whole strategy is about being in the right spot at the right moment.

C. Arbitrage

(Risk-Free Profits… in Theory)

• Perps: You often make money from the difference between spot price and perp price, adjusted by funding rates.
• Dated Futures: You focus on the basis — the gap between spot and the future — knowing that gap will shrink to zero on expiry day. It’s cleaner (no funding rate noise), but your timing must be exact.

D. Rolling Positions

• Perps: No rolling needed. Just keep paying funding and you’re in the game forever.
• Dated Futures: If you want to keep your position after 2 weeks, you need to “roll” into the next contract. That means extra trades, possible costs, and maybe different prices.

4. Why the Monthly Settlement Changes the Game

1. You’re now playing against the clock — your prediction must be right on expiry day, not “eventually.”
2. No funding fees — can be cheaper if you’d otherwise pay funding on perps.
3. Rolling risk — if you want to stay in, you must actively manage the rollover.
4. Cleaner price behavior — prices converge to spot at expiry, unlike perps which can drift with funding imbalances.

5. Real-Life Example: The Ice Cream Deal

Today, ice cream costs $2.

• Perps: You “rent” the right to buy it at $2 forever. Every few hours, you might pay or receive a small fee. You can quit any time. Yet funding fees eat your $2, and your collateral decreases.
• Dated Futures: You promise today that in exactly 1 month you’ll buy it for $2 — no matter what.
  • If price goes to $3 → You win.
  • If price drops to $1 → You lose.
  • Either way, the deal ends. You can reopen with a new budget and a new strategy.

6. Quick Summary

• Hedging: Perps = flexible, long-term. Dated = exact-date match.
• Speculation: Perps = trend riding for long-term traders. Dated = date-specific, ideal for intraday/swing traders.
• Arbitrage: Perps = funding-based. Dated = basis-based.
• Costs: Perps = continuous funding. Dated = no funding.
• Risk: Perps = price + funding rate. Dated = price + expiry timing.

Final Thought

Think of perps as an open-ended journey — you decide when to stop.

Think of dated futures as a race with a finish line — you must be ahead when the clock runs out.

Both can be powerful. The key is matching the tool to the job:

• Want to trade long distance and pay higher fees? → Perps.
• Want more trades with the same collateral in short bursts? → Dated Futures.