Navigating the world of cryptocurrency derivatives can be complex, especially with various contract types and settlement mechanisms. USDC-based perpetual and futures contracts offer distinct advantages and features for traders looking to leverage their positions with a stablecoin-denominated approach. This guide breaks down everything you need to know about these instruments, from core definitions to advanced trading strategies.
What Are USDC Perpetual Contracts?
A USDC Perpetual contract is a type of derivative that uses USDC (a USD-pegged stablecoin) as the settlement asset, while being quoted in USD. These contracts have no expiration date, allowing traders to hold long or short positions indefinitely.
For example, when trading a BTC-PERP contract, you place orders based on the quantity of Bitcoin. However, all margin requirements, profits, and losses are calculated and settled in USDC. This provides a stable pricing and settlement environment, reducing exposure to the volatility of other cryptocurrencies.
Understanding USDC Futures Contracts
USDC Futures contracts share similarities with their perpetual counterparts—they are quoted in USD and settled in USDC. The key differences lie in their structure:
- They have a predefined expiration or settlement date.
- There are no funding fees involved.
- On the settlement date, all open positions are closed at a predetermined price.
This makes futures contracts ideal for traders looking to hedge or speculate on future price movements with a fixed timeline.
Key Differences Between USDC Perpetual and Futures Contracts
While both contract types use USDC for settlement, several factors set them apart:
| Feature | USDC Perpetual | USDC Futures |
|---|---|---|
| Expiration | No expiration date | Fixed settlement date |
| Fees | Trading fee, funding fee | Trading fee, settlement fee (currently 0%) |
| Account Requirement | Available to all users | Requires Unified Trading Account upgrade |
Beyond these differences, both contracts function similarly in terms of trading mechanics and settlement processes. For a deeper dive, 👉 explore advanced trading strategies.
USDC Perpetual vs. USDT Perpetual Contracts
Both USDC and USDT perpetual contracts are linear perpetual products, but they differ primarily in collateral:
- USDC Perpetual: Uses USDC as collateral.
- USDT Perpetual: Uses USDT as collateral.
The choice between them often comes down to personal preference, market conditions, or specific platform requirements. Both offer leverage and no expiration, but settlement and fee structures may vary slightly.
Margin Modes: Cross Margin Only
Unlike some other derivatives, USDC Perpetual and Futures contracts only support cross margin mode. In this mode, all available balance in your account is used as margin for open positions, and you can select your preferred leverage level. Isolated margin is not available, which simplifies risk management but requires careful attention to overall account equity.
Trading USDC Futures: Access and Eligibility
To trade USDC Futures, users must upgrade to a Unified Trading Account. This advanced account type offers integrated management of various derivatives and spot products, providing a seamless trading experience. If you cannot access USDC Futures, check your account type and upgrade if necessary.
Types of USDC Futures Contracts
Bybit offers multiple expiration cycles for USDC Futures contracts, including:
- Weekly
- Bi-Weekly
- Tri-Weekly
- Monthly
- Bi-Monthly
- Quarterly
- Bi-Quarterly
This variety allows traders to choose contracts that align with their trading horizons and strategies.
Contract Listing Schedule
New USDC Futures contracts are listed every Friday at 8 AM UTC. The weekly contract delivery triggers a rollover:
- Bi-weekly contracts become the new weekly.
- Tri-weekly contracts become the new bi-weekly.
- A new tri-weekly contract is generated.
If a monthly contract’s delivery date overlaps with an upcoming tri-weekly, the monthly becomes the new tri-weekly, and a new bi-monthly contract is created.
8-Hour Session Settlement Mechanism
USDC Perpetual and Futures contracts use an 8-hour settlement cycle to convert unrealized profit and loss into realized PnL. This improves asset utilization by reflecting gains and losses directly in your wallet balance.
Settlement occurs at:
- 8 AM UTC
- 4 PM UTC
- 12 AM UTC
For instance, if you have a 200 USDC profit at settlement, it is credited to your balance immediately.
Why Does My Average Entry Price Change?
The 8-hour settlement mechanism impacts your average entry price. After each cycle, the mark price at settlement becomes the new average entry price for your position. This adjustment ensures that PnL is accurately reflected and realized periodically.
Using Unrealized Profit to Open New Positions
Yes, unrealized profits from open positions can be used as margin to open new trades. This allows for greater flexibility and capital efficiency, enabling you to compound gains or hedge existing positions without additional deposits.
Simultaneous Long and Short Positions
USDC contracts only support one-way mode, meaning you can only hold either a long or short position in a single contract at any time. This simplifies position management but limits complex hedging strategies within the same instrument.
Trading Fees Structure
Bybit charges:
- Maker fee: 0.02%
- Taker fee: 0.055%
These fees are competitive and designed to reward liquidity providers while ensuring efficient trade execution.
Maker vs. Taker Orders
- Maker orders add liquidity to the order book by placing limit orders that are not immediately filled.
- Taker orders remove liquidity by executing immediately against existing orders.
Understanding this distinction helps optimize trading costs, as maker orders typically incur lower fees.
Maximum Leverage Limits
Maximum leverage varies by trading pair and is subject to risk limits. Higher leverage increases potential returns but also amplifies risks. Always check the current leverage limits for your chosen symbol before trading.
Order Limits and Types
Traders can place:
- Up to 500 active orders (latest 100 displayed)
- Up to 10 conditional orders
Supported order types include:
- Market orders
- Limit orders
- Conditional orders
- Take-profit/stop-loss (TP/SL) orders
Placing Maker-Only Limit Orders
To ensure your limit order acts as a maker:
- For long orders: set price < best ask
- For short orders: set price > best bid
Enabling the "Post-Only" feature guarantees that your order will only be filled as a maker, helping reduce fees.
Order Price Limits
USDC Perpetual contracts have price boundaries:
- Lowest price: 10% of last traded price
- Highest price: 999,999
These limits prevent erroneous orders and maintain market stability.
Portfolio Margin vs. Cross Margin
Under portfolio margin, initial margin (IM) requirements depend on position hedging:
- Hedged positions may require lower IM.
- Unhedged positions may require higher IM.
This system optimizes capital efficiency for advanced traders with diversified portfolios.
Transferring USDT to USDC Accounts
You can convert USDT to USDC at real-time rates and transfer funds to your USDC Derivatives or Unified Trading Account. This flexibility allows easy access to USDC markets without preholding large amounts of USDC.
Managing Risk with Subaccounts
Subaccounts isolate PnL and risk from your main account, providing a valuable tool for risk management. Transfers between accounts are facilitated through your spot wallet, ensuring clear segregation of funds.
Laddered Liquidation Process
Bybit uses laddered liquidation to reduce market impact and avoid full liquidation of positions. This mechanism partially liquidates positions to meet margin requirements, giving traders more time to manage their risks.
Frequently Asked Questions
What is the main advantage of USDC contracts?
USDC contracts offer stability through USD-pegged settlement, reducing volatility exposure compared to crypto-collateralized derivatives. They also provide regular settlement cycles for better capital efficiency.
Can I use USDC contracts for hedging?
Yes, their fixed settlement and variety of expiries make them suitable for hedging against spot holdings or other derivatives. However, one-way mode limits same-contract hedging.
How does the 8-hour settlement benefit traders?
It realizes profits and losses regularly, freeing up margin and improving asset utilization. This allows traders to reinvest gains quickly without waiting for position closure.
What happens if I hold a futures contract until expiration?
The position is automatically closed at the settlement price, and any profit or loss is realized in USDC. Ensure you manage or roll over positions before expiry to avoid unintended closures.
Is there a minimum trade size for USDC contracts?
Minimum trade sizes vary by symbol but are generally low to accommodate retail traders. Check the trading rules for specific pairs before executing orders.
Can I automate trades with USDC contracts?
Yes, conditional orders, TP/SL, and API access allow full automation. This enables algorithmic strategies and hands-free position management.