How to trade on Binance Futures

Binance Futures is a global trading platform that allows you to trade various types of cryptocurrency future contracts. It is the largest platform on the net and you can currently trade over 530 crypto coin pairs on it.

Binance Futures makes it easy for you to speculate and trade on potential price movements of a crypto pair, without actually owning the underlying asset. Add the availability of leverage and your potential for making money is greatly increased.

This short guide shows you what you can achieve on Binance Futures and how you can go about it. It is meant for those willing to take a little risk and play the markets.

What Is Binance Futures?

Take for instance, something bad happened with crypto coin A, and the news is spreading. At the same time, lots of good news are about to break for crypto coin B. The math here is simple: sometime in the future, hours, days, weeks, etc, crypto coin B will be more valuable against crypto coin A than it currently is.

In such a situation, the clever fellow looking to make a quick profit will use as much coin A as he can afford to buy coin B. Then all he has to do is wait until coin B gains against coin A, and he can now sell his coin B assets for more coin A than he originally had, thereby turning a profit.

Binance Futures is a platform that enables you to conduct such transactions, and it makes it easy too. By providing access to hundreds of crypto pairs, you can easily find the instruments of your choice to trade and profit from.

Why Should You Trade Binance Futures?

There are many good reasons why you should trade crypto futures on the Binance platform. Here are the most compelling ones.

• Huge Selection of Coins: With over 530 crypto-to-crypto trading pairs, the Binance Futures platform offers you a vast selection of instruments to trade at all times. This vast selection also includes all types of coins—from popular utility tokens to meme-coins, DeFi tokens, and so on. You are sure to find the right pair on Binance.
  
• Deep Liquidity: In addition to its vast selection of coins, Binance Futures also gets plenty of participation from users all over the world, who provide enough trading activity and liquidity to make it a solid platform that executes trades with as little slippage as possible. Slippage happens when a user requests to buy or sell an instrument but there is not enough liquidity at the current market price. The system solves this problem by filling all the available liquidity at current prices, then completing the order with less favorable prices. So, for instance, you need to buy a $1,000 worth of coin A at a market price of $2 per coin. That should make 500 coins in total. However, only 400 coins are available at $2, while the remaining 100 coins are available at $2.01. This difference is called slippage.
  
• Leverage: Binance Futures offers leveraged trading for small accounts, enabling serious traders to build up a portfolio. Remember, however, that leverage is a double-edged sword because while it can enhance your earnings, it can also enhance your losses.

• Low Fees: Fees on the platform can go as low as 0.017% for takers and 0.000% for makers. A maker is a trader that creates liquidity on the exchange by offering pre-defined trades as a market maker. A taker, on the other hand, buys and sells contracts offered by makers.
  
• 28+ Million Users: Binance has over 28 million active users worldwide and this makes it both a trusted platform and gives it the ability to provide more trading liquidity at lower prices. Binance handled over $7.7 trillion of crypto trade volume in 2021.

• Secure Platform: Binance features various security mechanisms to keep the platform safe. They include KYC (Know Your Customer) verifications for new users, 2FA (2-factor authentication) to keep your logins secure, and anti-phishing code to shield users from scammers.

Are You Ready to Trade?

Here are a few questions that most beginners fail to ask themselves.

1. Are you ready to start trading?
2. Do you know what you are doing or are you just gambling?
3. Do you have a strategy, a trading plan?

The truth is that you first need to learn the ropes, if you are to become a successful trader. You also need to know the basics of trading—the terms, technologies, conventions, methods, etc. This is also necessary because Binance will quiz you and you need to pass before you can open a Futures account on its platform.

You also need to have a trading strategy, which helps you to analyze the market at any time and provide possibly profitable trading opportunities. Your strategy can be technically or fundamentally based, or a combination of both. What matters is that it allows you to earn profits.

Next, you need to have a trading plan, which includes one or a few pairs that you trade, your risk per trade, expected payoff, and other risk management preferences.

Finally, with all requirements attained, you can now proceed to trade on Binance Futures.

How To Trade on Binance Futures

Trading on Binance Futures is straightforward and easy to learn, but first, you will need to create and activate your account. So here is the step-by-step guide to begin trading on Binance Futures.

Step 1. Register a Binance Account

Your first step is to head over to Binance and click on “Sign Up” at the top-right side of the site. This will lead you through the process of signing up with your email, entering your country of residence, password, and so on.

Step 2. Get Verified

After entering all your details, Binance will send a verification code to your email, which you have to confirm on the site. They may also send a verification code to your phone number to confirm that it is yours. If you pass this verification process, then you become a standard Binance user.

Step 3. Open A Binance Futures Account

Once you have your Binance account properly registered, you can now register for other Binance services such as Binance Futures. To register for Binance Futures, head over to the Binance Futures platform and click on “Open Account”. The platform offers USD-M futures that are settled in USDT (USD Tether) or BUSD (Binance USD tether). It also offers COIN-M accounts that are settled in cryptocurrencies. Make your choice and continue.

Step 4. Take The Quiz

Binance will make you take a quiz before you can start trading futures on its platform. This step is necessary to confirm that whoever is opening a Binance Futures account knows what he or she is doing. So, you need to pass this quiz to continue.

Step 5. Verify Your Identity

Unlike the first verification step, this step verifies your government issued IDs and the process will depend on your country of residence. Verifying your real identity in this step is necessary to allow you access to all of Binance Future’s features.

Step 6. Deposit Funds Into Your Account

Finally, it is time to fund your Binance Futures trading account and join in on the action. The platform is flexible, so you can either do this with fiat or crypto payments. You can click on “Buy Crypto” at the top left corner of the website to fund your account via fiat or click on “Wallet”, then “Fiat and Spot” and finally on “Deposit” to deposit crypto coins.

Step 7. Make Your First Trade

With your account fully verified and funded, your next step is to make your first trade. To do this, head over to the Binance Futures Platform and click on either USD-M or COIN-M or stablecoin or crypto-settled contracts, and when the page loads, select the crypto pair that you wish to trade from the top-left corner. Now you can monitor the market via its chart and when you find potentially profitable trades, you either go long or short. The platform features all trading controls, such as margin, leverage settings, stop loss, and take profit.

Frequently Asked Questions

The following are frequently asked questions about trading on Binance Futures.

Q: How many pairs can I trade on Binance futures?

A: There are currently 530+ crypto pairs that you can trade on Binance Futures. They include everything from stable to utility, and meme coins.

Q: Is leverage allowed on Binance futures?

A: Yes, Binance Futures offers leveraged trading.

Q: Can I fund my Binance account with fiat or crypto?

A: You can fund your Binance trading account using either fiat or crypto.

Q: Is crypto futures trading on Binance safe?

A: Yes, trading crypto on Binance Futures is safe when you follow the rules and adhere to the safety guidelines.

Conclusion

We have reached the end of this quick guide on opening a Binance Futures account and trading on the platform. You have also seen the different stages required to complete the process, as well as the requirements that you need to fulfill.

From here onward, how much money you make (or lose) depends on your skill and trading system. Also remember that Binance offers demo trading and copy trading, so you can still participate in the markets while you are learning to become a better trader.