Bitget Beginner's Guide — Understanding Spot, Margin, and Futures Trading on Bitget

[Estimated Reading Time: 5 mins]

This article explains the main differences between spot, margin, and futures trading on Bitget—helping you choose the best trading method for your goals and risk appetite.

What are spot, margin, and futures trading?

Bitget offers three main trading types: spot, margin, and futures. Each type caters to different trading styles and risk levels.

Spot trading: Spot trading is the most straightforward form of crypto trading, where you buy or sell cryptocurrencies directly. Trades are executed using your own funds, and assets are settled to your account immediately. Prices are determined by supply and demand in the spot market. This method is simple, low-risk, and suitable for conservative investors, with gains reflecting actual market movements.

Margin trading: Margin trading builds on spot trading by allowing you to borrow funds (e.g., 3x or 5x leverage) to increase your position size. You combine your own funds with borrowed capital from the platform to execute trades, and borrowed funds incur interest. Prices are based on the spot market. Margin trading is suitable for users seeking moderate risk and amplified returns.

Futures trading: Futures trading lets you speculate on the future price of cryptocurrencies by buying or selling futures contracts, such as perpetual or quarterly futures. You can use leverage of up to 125x, which increases both potential returns and risk. Futures trading offers greater strategic flexibility, allowing traders to go long (predicting price increases) or short (predicting price decreases).

Comparison of spot, margin, and futures trading

Feature	Spot trading	Margin trading	Futures trading
Trading asset	Actual cryptocurrency	Actual cryptocurrency (with leverage)	Cryptocurrency futures
Asset ownership	Yes	Yes	No
Leverage	None	Low (3–5x)	High (up to 125x)
Trading method	Full amount	Borrowed funds	Margin-based
Risk and return	Low risk, gains reflect market movement	Moderate risk and return	High risk, high return
Strategy flexibility	Simple (buy and hold)	Moderate (short-term gains)	High (long/short/hedging)

Summary:

• Spot trading is ideal for conservative investors.

• Margin trading suits traders aiming for moderate leverage.

• Futures trading is designed for experienced traders seeking flexibility and volatility exposure.

Use case comparison

Let's illustrate the difference with an example.

• Current BTC price: 30,000 USDT

• User's capital: 3000 USDT

1. Spot trading

Action: Buy 0.1 BTC with 3000 USDT. Outcome:

• If BTC rises to 33,000 USDT (+10%), you gain 300 USDT (0.1 BTC × 3000 USDT).

• If BTC drops to 27,000 USDT (−10%), you lose 300 USDT.

Highlight: No leverage and no liquidation risk, and profit or loss moves directly with the market. However, this is a theoretical example, and actual results may differ because of trading fees, slippage, and real-time market volatility.

2. Margin trading (3x leverage)

Action: Buy 0.3 BTC using 3x leverage (invest 3000 USDT and borrow 6000 USDT). Outcome:

• If BTC rises to 33,000 USDT (+10%), you gain 900 USDT (before interest).

• When BTC drops by about 30% (around 21,000 USDT), your margin would generally be close to being fully used. At this level, the position may enter the liquidation zone, depending on your real-time risk ratio.

Note: The actual liquidation price can occur earlier than 21,000 USDT because interest, fees, and market movements continuously affect your margin risk ratio. The number above simply reflects the price movement, not the final liquidation price. Highlight: Profits and losses are magnified 3x. Monitor your risk ratio closely.

3. Perpetual futures trading (10x leverage)

Action: Open a 10x long BTC futures position worth 30,000 USDT using 3000 USDT as margin. Outcome:

• If BTC rises to 33,000 USDT (+10%),you gain 3000 USDT.

• If BTC drops by around 10% (to approximately 27,000 USDT), the position may enter the liquidation zone.

Note: This is a theoretical example, and the actual liquidation price can occur earlier than 27,000 USDT because of funding rates, trading fees, and real-time market volatility.

What to know before you trade

Spot, margin, and futures trading on Bitget each serve different trading needs. Choose the type that fits your risk tolerance, capital, and market strategy. Bitget offers advanced trading tools and features to help you monitor and manage positions, whether you prefer spot trading or high-leverage futures strategies.

Trading involves the possibility of gains and losses. Margin and futures positions use leverage, which can magnify outcomes. Features like stop-loss, take-profit, and real-time monitoring help you manage your trades effectively.

FAQ

1. What are futures contracts?

Futures contracts are agreements to buy or sell cryptocurrency at a future date. They let you speculate on price movements without owning the underlying asset, using leverage for higher potential gains and risks.

2. Can I lose more than my initial investment in margin or futures trading?

Yes. In margin and futures trading, losses can exceed your initial investment if the market moves against your position, potentially triggering liquidation. Spot trading does not have this risk.

3. Can I go short in trading?

Yes. Futures trading allows you to go short, meaning you can profit if the price of a cryptocurrency decreases.

4. How do funding rates work in futures trading?

Funding rates are periodic payments between long and short positions in perpetual futures. They help keep the contract price aligned with the spot market.

5. Can I hold both long and short positions at the same time?

Yes, in futures trading, you can hold multiple positions in different directions, which is useful for hedging or advanced strategies.

Disclaimer and Risk Warning All trading tutorials provided by Bitget are for educational purposes only and should not be considered financial advice. The strategies and examples shared are for illustrative purposes and may not reflect actual market conditions. Cryptocurrency trading involves significant risks, including the potential loss of your funds. Past performance does not guarantee future results. Always conduct thorough research and understand the risks involved. Bitget is not responsible for any trading decisions made by users.