Crypto Trading: Perpetuals, Options and Market Structure

Crypto is the market where trading's oldest lessons were relearned fastest. It trades 24 hours a day, seven days a week, on hundreds of venues that combine the roles of exchange, broker, custodian, clearing house and sometimes market maker; it offers leverage of 100 times or more on offshore platforms; and its dominant instrument is one that did not exist before 2016, the perpetual swap, a future that never expires and is kept close to the spot price by periodic funding payments between longs and shorts. BitMEX launched the first, its XBTUSD perpetual, on 13 May 2016 (BitMEX announcement). Since then crypto has produced the largest single-day forced liquidation in its history — about $19bn of leveraged positions liquidated in 24 hours on 10–11 Oct 2025, after a US tariff announcement on Chinese imports (CoinGlass data as reported; CoinGlass itself said the true figure was likely higher because Binance reports only one liquidation order per second) — and one of the largest frauds in financial history, the collapse of FTX and its trading affiliate Alameda Research in November 2022. It has also moved onshore in the United States. The SEC approved eleven spot bitcoin exchange-traded products on 10 Jan 2024, and ten began trading the next day with ~$4.6bn of first-day volume (reported); options on BlackRock's iShares Bitcoin Trust (IBIT) began trading on Nasdaq on 19 Nov 2024, with ~354,000 contracts and ~$1.9bn of notional on day one (reported). Coinbase closed its purchase of Deribit, the dominant crypto options exchange, on 14 Aug 2025 (~$2.9bn headline; Finance Shared facts) and listed CFTC-regulated "perpetual-style" futures on 21 Jul 2025; the CFTC announced on 4 Dec 2025 that listed spot crypto would trade on CFTC-registered exchanges (reported). This section explains spot and perpetual markets and funding, crypto options, basis and cash-and-carry trades, exchange and counterparty risk (FTX), liquidation engines and auto-deleveraging, the US ETF and options market, the market makers, wash trading and fake volume, and the 2025–26 rules. It has no worked example (not a ★ section); two small stylized tables on funding and leverage are computed in Python.