Open futures on Binance and you’ll see perpetual contracts, plus quarterly contracts with a string of digits after the name, such as the BTC 0925 that the help center uses as its example. A perpetual contract has no expiry date. As long as it isn’t liquidated, you can hold it indefinitely, and the funding rate keeps its price close to the spot index, so you pay or receive funding at regular intervals while you hold it. A delivery contract (Binance calls these quarterly futures) has a fixed expiry date, settles at the delivery price when it expires, and has no funding payments.
For trades held from a few hours to a few days, a perpetual is usually fine. Delivery contracts come into it only if you plan to hold for weeks or longer and don’t want funding taken out again and again, and only if you keep the expiry date firmly in mind. The comparison below is based on Binance’s help center article on perpetual and quarterly futures.
The two contracts side by side
| Perpetual | Delivery (quarterly) | |
|---|---|---|
| Expiry | None. You can hold it as long as it isn’t liquidated | Has an expiry date, e.g. the help center’s BTC 0925 |
| Funding | Yes, paid periodically between longs and shorts | None |
| Link to the spot price | Converges toward the index price at regular intervals through the funding rate | Settles at the delivery price the exchange publishes at expiry |
| Who it suits | Short-term traders who don’t want to track an expiry date | People planning to hold for weeks or longer who want to avoid funding, and hedgers |
The help center’s view of quarterly contracts is that having no funding payments makes them better for long-term position holders and hedgers, because funding moves with the market, and in extreme conditions holding a perpetual can get expensive.
The funding rate: the extra holding cost on perpetuals
If a perpetual never has a delivery day, what stops its price from drifting away? The funding rate. Funding is based on the gap between the perpetual contract and spot, and it’s paid periodically between longs and shorts. Whether you pay or receive depends on whether you’re long or short and whether the rate is positive or negative. When the rate is positive, longs pay shorts, and when it’s negative, shorts pay longs. The amount is calculated on the position’s notional value.
The further the contract price sits above spot, the higher the rate tends to be, and the more it costs longs to hold their positions.
To find it, open the trading page for any Binance perpetual. The funding rate and a countdown are shown near the top. Most contracts settle every 8 hours, some at shorter intervals, so the countdown on the page is what counts. You only take part in a round of funding if you’re still holding the position at the moment it settles.
A rough one-month estimate (illustrative)
Setup: you hold one perpetual long with a notional value of 1,000 USDT, and the price is assumed not to move. The funding rate is 0.01% every time, paid by longs, with 3 settlements a day, held for 30 days.
That 9 USDT is based on notional value and has nothing to do with how much margin you posted. Open this position at 10x leverage with 100 USDT of margin, and one month of funding takes 9 ÷ 100 = 9% of your margin. Raise the leverage and funding takes a bigger bite out of your margin.
The real rate changes every round and can be positive or negative. When it’s negative, longs actually get paid. The help center gives one scenario too: when Bitcoin rallies, funding across BTC perpetual markets can surge, and holding a long gets noticeably more expensive. Held for a few hours, funding usually doesn’t matter much, but held for weeks or months it keeps piling up round after round.
What happens on a delivery contract’s expiry day
A delivery contract means buying or selling the underlying asset at a predetermined price before a set deadline. The help center’s example is BTC 0925, a quarterly contract that expires 3 months after its issue date. The digits after the contract name generally correspond to the delivery date. Check the contract details page to be sure.
At expiry, the position is settled at the delivery price the exchange publishes, and how that price is calculated is written in the contract’s rules page. Once it settles, the position is over. If you want to keep the exposure, you have to open a new position on the next contract.
If you use a delivery contract, note the expiry date on the day you open it. A few days before expiry, decide whether to close early, let it settle, or move to the next contract.
Check that futures are available where you live before you open either kind.
Hours, or weeks? How long you hold decides it
For short-term trades held from a few hours to a few days, perpetuals are usually the choice, because there’s no expiry date to track and funding doesn’t add up to much over a short time.
If you plan to hold for weeks or longer and don’t want funding taken again and again, delivery contracts are worth considering, as long as you remember the expiry date and have read on the contract’s rules page how the delivery price is calculated.
When comparing the cost of the two, don’t look only at whether there’s funding. A delivery contract normally trades at a gap to spot that only closes at expiry. Going long while it’s priced above spot amounts to paying a holding cost up front. So before opening a long on a delivery contract, my advice is to check how much more expensive it is than spot right now.
Whichever you pick, a futures position can be liquidated. Margin mode, what’s left after a liquidation, and how much leverage to use all work the same way on both. I’ve covered them in Cross or Isolated Margin? What Beginners Should Pick, Can You Owe Money After a Futures Liquidation? and What is Leverage? Why most new traders die here.
A few quick answers
Are delivery futures and quarterly futures the same thing?
On Binance, yes. Binance’s help center treats quarterly futures as its delivery contracts: they let you buy or sell the underlying asset at a predetermined price before a set deadline, they have an expiry date, and they are settled at expiry. Its example is BTC 0925, which expires 3 months after its issue date.
Is the funding fee on perpetual futures collected by the exchange?
No. It is not a trading fee. According to Binance’s help center, funding is based on the gap between the perpetual contract and the spot price, and is paid periodically between longs and shorts. Whether you pay or receive depends on whether you are long or short and whether the rate is positive or negative; the amount is based on the position’s notional value. For the settlement interval, go by the countdown on the contract page.
Roughly how much funding does a month in a perpetual cost?
Using an illustrative case: a notional value of 1,000 USDT, the price assumed flat, a funding rate of 0.01% each time and 3 settlements a day works out to 1,000 × 0.01% × 3 × 30 = 9 USDT over 30 days. The real rate can be different at every settlement and can be positive or negative. Because it is based on notional value, with leverage it takes a much bigger share of your margin.
Should a beginner pick perpetual or quarterly futures?
For short-term trades, perpetuals are usually the choice, since there is no expiry date to track. Consider quarterly futures only if you plan to hold for weeks or longer and do not want funding taken again and again, and make sure you remember the expiry date. Both kinds can be liquidated, and the logic for controlling leverage and position size is the same.