1. Arbitrage strategy for perpetual contracts (1) What is a perpetual contract? A perpetual contract is an "innovative" futures contract, pioneered by BitMEX. While traditional contracts have an expiry date, perpetual contracts have no delivery date and can be held forever, hence the name perpetual contract. Traditional contracts have delivery because the delivery price is based on the spot weighted price of the underlying on that day, the weighting is to prevent manipulation of the spot price for a short period of time. Normally, a futures price that is higher than the spot price is known as an uplift and the opposite is a discount. However, as there is delivery and the futures spot price is the same at the moment of delivery, the futures price does not deviate significantly from the spot price, otherwise there would be scope for arbitrage. Users with long term positions will have to move their positions to a contract further out before one expires. This operation is a hassle, secondly, they have to pay additional commission and thirdly, there will generally be a spread between two contracts with different maturities and the move operation will result in a small gain or loss. Bitcoin, on the other hand, has a 7x24 trading feature that corresponds to a futures contract, and people will have more fun if there is no delivery. Thus, the perpetual contract was created by BitMEX. It has no delivery date, and any long or short position can be held forever. This type of perpetual contract with no delivery soon took the world by storm and became the standard for all major digital coin exchanges. (2) Characteristics of perpetual contracts For a normal futures contract, the contract price will converge to the spot price on the settlement date. This is because the closer you get to delivery, the more predictable the spot price becomes, and the frequent trading activity of speculators requires the price of the expiring futures contract to be in line with the spot price. However, this is not mandatory and traders with sufficient capital have the ability to push futures prices up or down on their own, causing the futures price to deviate significantly from the spot price, especially as the delivery date approaches. This situation is also known as a forced position. In contrast, perpetual contracts have no delivery date, allowing investors to track virtual currency prices continuously and over time. In terms of price convergence mechanisms, perpetual contracts anchor the spot price through a funding rate, making them more difficult for large investors to manipulate prices. To control the price of perpetual contracts within an exchange, one would have to shake up the entire market price of bitcoin. These characteristics of perpetual contracts were particularly important in an era when virtual currencies were under-traded and under-recognised. (3) Funding Rate Arbitrage Principle When the funding rate is positive, the multi-party user (contract buyer) pays the short side (contract seller) the funding fee; when the funding rate is negative, the short side user (contract seller) pays the buyer user (contract buyer) the funding fee. Without taking into account the risk of currency price fluctuations, it is possible to achieve high returns by holding positions in those currencies where the funding rate remains consistently high. In other words, if a currency has a very high funding rate and the high rate persists for a long period of time, the investor has the opportunity to make continuous gains through the funding rate mechanism. (4) The core of perpetual contract arbitrage Currency selection: high funding rates + long duration. To take advantage of a funding rate arbitrage strategy, investors should first select a currency with a very high funding rate that can be maintained for a long period of time. Use the spot and leveraged markets to take two-way positions to hedge against the risk of currency price fluctuations. In order to cope with the risk of currency price fluctuations, users should take a position in perpetual contracts with a capital rate arbitrage strategy and hedge the same position with spot or leverage in order to achieve long-term profits. (5) Arbitrage methods for perpetual contracts (1) Funding rates on perpetual contracts - spot arbitrage a. Buy the currency spot. b. Simultaneously open a short position in the corresponding currency perpetual contract of the same position. c. Depending on the profit target, close the short position in the perpetual contract and sell the spot at a time to make a profit. ② Funding rate for perpetual contracts - leveraged arbitrage a. When the funding rate is positive and | funding rate| > leverage rate + commission rate, the short side of the contract can charge the long side a funding fee, i.e. the perpetual contract is opened short and leveraged to buy a position of equivalent value in spot. b. When the funding rate is negative and | funding rate| > leverage rate + commission rate, the long side of the contract can charge the short side a funding fee for opening a long position in the perpetual contract and leverage to sell a spot of equivalent position value. (6) Cautions ① Don't change currencies frequently to avoid high transaction fees due to high frequency position transfers and currency hedging changes, resulting in profits earned that are difficult to cover transaction costs. (2) Do your research and choose your currency carefully. If you want to profit from a funding rate strategy, you need to do your research on the relevant currencies and funding rate details, and try to choose those with high rates and long duration. (iii) Reduce leverage to prevent blowouts. Although funding rate arbitrage can be low-risk or even risk-free based on the convergence of perpetual contracts and spot prices, you still need to be fearful of the market and beware of abnormal price fluctuations that may lead to a position blowout. ④ Reasonable capital investment to control trading risks. Some small currencies do not have enough market depth, and investing large amounts of money in trading may produce large slippage.

2. The content introduced above is only about the basics of cryptocurrency, which is related to whether we can make money through cryptocurrency. Cryptocurrencies make money not only by scientific methods to increase income, but also by finding ways to save money. The handling fees are small, but they must not be ignored. I have calculated that with frequent transactions and long trading hours, the accumulation of fees can add up to more than 10,000 U a year. Next I will introduce a few common ways to reduce fees on large trading platforms. (1) Lowering Binance's fees Binance is currently the world's largest digital currency exchange, and you must sign up for Binance if you want to speculate on coins. The transaction fee is deducted from the assets received. For example, if you buy Ethereum/USDT, the fee is paid in Ethereum. If you sell Ethereum/USDT, the commission is paid in USDT. Example. You place an order for 10Ethereum at a price of USD3,452.55 per share. Transaction fee = 10Ethereum0.1% = 0.01Ethereum Or you place an order to sell 10Ethereum at 3,452.55 USDT per share. Transaction fee = (10Ethereum3,452.55USDT)*0.1% = 34.5255USDT What many people do not know is that the Binance transaction fee can also be reduced. If you want to reduce your Binance trading fees, you must use the invitation link below or use the invitation code "Q022W7SC" to register. https://accounts.binance.com/en/register?ref=Q022W7SC

(2) Reducing OKX fees OKX is a professional digital currency trading platform loved by many users, and its transaction fees can be reduced. Depending on the volume of transactions, OKX divides its users into two levels: normal and professional. Ordinary users are graded according to their OKB positions, while professional users are graded according to their trading volume and asset size. The different tiers determine the trading fees for the next trading day. When calculating the fee levels, if the coin trading volume, total trading volume of delivery and perpetual contracts (USDT delivery contract, coin-based delivery contract, USDT perpetual contract, coin-based perpetual contract), option contract trading volume, and asset volume meet the conditions of different fee levels, users will enjoy the fee discount of the highest level. First method: OKX has an official maximum savings rate of 20%. Use the link below to register with OKX and save 20% on fees. https://www.ouyi.business/join/BTC1ETH Second method: Open the OKX website and enter "BTC1ETH" in the "Invitation Code" on the registration page to see the cashback percentage: 20% at the bottom. Be sure to enter this invitation code, otherwise you can not get 20% cashback percentage. (3) Reduce FTX fees FTX is currently a very fast-growing, contract players more exchange, you must register FTX if you play the contract. if you want to reduce the FTX transaction fees, you must use the following invitation link to register. https://ftx.com/referrals#a=121031692 3, trading road is long, together with the forward Want to know more about how to reduce the commission? telegram: btcethcool We have set up a community dedicated to the study of trading, add telegram friends to pull you into the community.

1. Arbitrage strategy for perpetual contracts (1) What is a perpetual contract? A perpetual contract is an "innovative" futures contract, pioneered by BitMEX. While traditional contracts have an expiry date, perpetual contracts have no delivery date and can be held forever, hence the name perpetual contract. Traditional contracts have delivery because the delivery price is based on the spot weighted price of the underlying on that day, the weighting is to prevent manipulation of the spot price for a short period of time. Normally, a futures price that is higher than the spot price is known as an uplift and the opposite is a discount. However, as there is delivery and the futures spot price is the same at the moment of delivery, the futures price does not deviate significantly from the spot price, otherwise there would be scope for arbitrage. Users with long term positions will have to move their positions to a contract further out before one expires. This operation is a hassle, secondly, they have to pay additional commission and thirdly, there will generally be a spread between two contracts with different maturities and the move operation will result in a small gain or loss. Bitcoin, on the other hand, has a 7x24 trading feature that corresponds to a futures contract, and people will have more fun if there is no delivery. Thus, the perpetual contract was created by BitMEX. It has no delivery date, and any long or short position can be held forever. This type of perpetual contract with no delivery soon took the world by storm and became the standard for all major digital coin exchanges. (2) Characteristics of perpetual contracts For a normal futures contract, the contract price will converge to the spot price on the settlement date. This is because the closer you get to delivery, the more predictable the spot price becomes, and the frequent trading activity of speculators requires the price of the expiring futures contract to be in line with the spot price. However, this is not mandatory and traders with sufficient capital have the ability to push futures prices up or down on their own, causing the futures price to deviate significantly from the spot price, especially as the delivery date approaches. This situation is also known as a forced position. In contrast, perpetual contracts have no delivery date, allowing investors to track virtual currency prices continuously and over time. In terms of price convergence mechanisms, perpetual contracts anchor the spot price through a funding rate, making them more difficult for large investors to manipulate prices. To control the price of perpetual contracts within an exchange, one would have to shake up the entire market price of bitcoin. These characteristics of perpetual contracts were particularly important in an era when virtual currencies were under-traded and under-recognised. (3) Funding Rate Arbitrage Principle When the funding rate is positive, the multi-party user (contract buyer) pays the short side (contract seller) the funding fee; when the funding rate is negative, the short side user (contract seller) pays the buyer user (contract buyer) the funding fee. Without taking into account the risk of currency price fluctuations, it is possible to achieve high returns by holding positions in those currencies where the funding rate remains consistently high. In other words, if a currency has a very high funding rate and the high rate persists for a long period of time, the investor has the opportunity to make continuous gains through the funding rate mechanism. (4) The core of perpetual contract arbitrage Currency selection: high funding rates + long duration. To take advantage of a funding rate arbitrage strategy, investors should first select a currency with a very high funding rate that can be maintained for a long period of time. Use the spot and leveraged markets to take two-way positions to hedge against the risk of currency price fluctuations. In order to cope with the risk of currency price fluctuations, users should take a position in perpetual contracts with a capital rate arbitrage strategy and hedge the same position with spot or leverage in order to achieve long-term profits. (5) Arbitrage methods for perpetual contracts (1) Funding rates on perpetual contracts - spot arbitrage a. Buy the currency spot. b. Simultaneously open a short position in the corresponding currency perpetual contract of the same position. c. Depending on the profit target, close the short position in the perpetual contract and sell the spot at a time to make a profit. ② Funding rate for perpetual contracts - leveraged arbitrage a. When the funding rate is positive and | funding rate| > leverage rate + commission rate, the short side of the contract can charge the long side a funding fee, i.e. the perpetual contract is opened short and leveraged to buy a position of equivalent value in spot. b. When the funding rate is negative and | funding rate| > leverage rate + commission rate, the long side of the contract can charge the short side a funding fee for opening a long position in the perpetual contract and leverage to sell a spot of equivalent position value. (6) Cautions ① Don't change currencies frequently to avoid high transaction fees due to high frequency position transfers and currency hedging changes, resulting in profits earned that are difficult to cover transaction costs. (2) Do your research and choose your currency carefully. If you want to profit from a funding rate strategy, you need to do your research on the relevant currencies and funding rate details, and try to choose those with high rates and long duration. (iii) Reduce leverage to prevent blowouts. Although funding rate arbitrage can be low-risk or even risk-free based on the convergence of perpetual contracts and spot prices, you still need to be fearful of the market and beware of abnormal price fluctuations that may lead to a position blowout. ④ Reasonable capital investment to control trading risks. Some small currencies do not have enough market depth, and investing large amounts of money in trading may produce large slippage.

2. The content introduced above is only about the basics of cryptocurrency, which is related to whether we can make money through cryptocurrency. Cryptocurrencies make money not only by scientific methods to increase income, but also by finding ways to save money. The handling fees are small, but they must not be ignored. I have calculated that with frequent transactions and long trading hours, the accumulation of fees can add up to more than 10,000 U a year. Next I will introduce a few common ways to reduce fees on large trading platforms. (1) Lowering Binance's fees Binance is currently the world's largest digital currency exchange, and you must sign up for Binance if you want to speculate on coins. The transaction fee is deducted from the assets received. For example, if you buy Ethereum/USDT, the fee is paid in Ethereum. If you sell Ethereum/USDT, the commission is paid in USDT. Example. You place an order for 10Ethereum at a price of USD3,452.55 per share. Transaction fee = 10Ethereum0.1% = 0.01Ethereum Or you place an order to sell 10Ethereum at 3,452.55 USDT per share. Transaction fee = (10Ethereum3,452.55USDT)*0.1% = 34.5255USDT What many people do not know is that the Binance transaction fee can also be reduced. If you want to reduce your Binance trading fees, you must use the invitation link below or use the invitation code "Q022W7SC" to register. https://accounts.binance.com/en/register?ref=Q022W7SC

(2) Reducing OKX fees OKX is a professional digital currency trading platform loved by many users, and its transaction fees can be reduced. Depending on the volume of transactions, OKX divides its users into two levels: normal and professional. Ordinary users are graded according to their OKB positions, while professional users are graded according to their trading volume and asset size. The different tiers determine the trading fees for the next trading day. When calculating the fee levels, if the coin trading volume, total trading volume of delivery and perpetual contracts (USDT delivery contract, coin-based delivery contract, USDT perpetual contract, coin-based perpetual contract), option contract trading volume, and asset volume meet the conditions of different fee levels, users will enjoy the fee discount of the highest level. First method: OKX has an official maximum savings rate of 20%. Use the link below to register with OKX and save 20% on fees. https://www.ouyi.business/join/BTC1ETH Second method: Open the OKX website and enter "BTC1ETH" in the "Invitation Code" on the registration page to see the cashback percentage: 20% at the bottom. Be sure to enter this invitation code, otherwise you can not get 20% cashback percentage. (3) Reduce FTX fees FTX is currently a very fast-growing, contract players more exchange, you must register FTX if you play the contract. if you want to reduce the FTX transaction fees, you must use the following invitation link to register. https://ftx.com/referrals#a=121031692 3, trading road is long, together with the forward Want to know more about how to reduce the commission? telegram: btcethcool We have set up a community dedicated to the study of trading, add telegram friends to pull you into the community.