When trading derivatives on leading cryptocurrency exchanges, understanding the nuances between contract types is essential for making informed decisions. On OKX, two primary derivative instruments are available: perpetual contracts and delivery contracts. While both allow traders to speculate on price movements using leverage, they differ significantly in structure, mechanics, and use cases.
This guide breaks down the key differences between perpetual and delivery contracts on OKX, helping you determine which product aligns best with your trading strategy, risk tolerance, and financial goals.
What Are Perpetual and Delivery Contracts?
Before diving into comparisons, let’s clarify what each contract type entails.
Perpetual Contracts
A perpetual contract is a futures-like instrument that does not have an expiration date. This allows traders to hold positions indefinitely, provided they maintain sufficient margin. These contracts are settled against a spot index price and use a mechanism called funding rates to keep their market price aligned with the underlying asset.
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Delivery Contracts
A delivery contract, also known as a dated or inverse futures contract, has a fixed maturity date. At expiration, the contract is settled—either through physical delivery of the underlying asset (like BTC or ETH) or cash settlement—depending on the platform and asset type. Unlike perpetuals, these contracts naturally converge to the spot price as they approach expiry.
Key Differences Between Perpetual and Delivery Contracts
Understanding the structural differences helps traders avoid unexpected costs or risks. Below are six core distinctions.
1. Expiration Date
- Perpetual Contracts: No expiration. Positions can be held for as long as margin requirements are met.
- Delivery Contracts: Fixed expiration dates—commonly weekly, bi-weekly, or quarterly. All open positions are settled at expiry.
This makes perpetuals ideal for long-term speculation, while delivery contracts suit tactical trades around specific timeframes.
2. Settlement Mechanism
- Perpetual Contracts: Settled continuously via a mark price based on the spot index. There is no physical delivery—positions are purely synthetic.
- Delivery Contracts: Settled at maturity. Depending on the contract design, settlement may involve actual transfer of the underlying cryptocurrency (e.g., BTC delivered to your wallet).
For most retail traders, perpetuals eliminate the complexity of handling actual crypto assets post-trade.
3. Margin Requirements
- Perpetual Contracts: Generally require lower initial margin due to continuous settlement and funding mechanisms that reduce systemic risk.
- Delivery Contracts: Often require higher margin levels, especially as expiration nears, to mitigate default risk during final settlement.
Lower margin thresholds make perpetuals more accessible for traders with limited capital.
4. Funding Fees vs. No Funding
Perpetual Contracts: Feature funding rates, where traders periodically pay or receive payments depending on whether longs or shorts dominate the market.
- If funding is positive, longs pay shorts.
- If negative, shorts pay longs.
- Delivery Contracts: No funding fees. Instead, price convergence happens naturally as the contract approaches expiry.
Funding rates can add cost—or generate income—for holding perpetual positions over time.
5. Delivery Risk
- Perpetual Contracts: No delivery risk, since there’s no settlement event.
Delivery Contracts: Carry delivery risk, especially for traders unprepared for settlement. For example:
- Inability to provide required collateral.
- Unexpected tax implications from receiving crypto assets.
- Wallet readiness for receiving large transfers.
While most traders close positions before expiry, those who don’t may face operational challenges.
6. Leverage Flexibility
Both contract types support leveraged trading, but:
- Perpetual Contracts: Often offer higher maximum leverage (up to 125x on OKX for certain pairs).
- Delivery Contracts: Typically cap leverage at lower levels (e.g., 20x–50x), varying by asset and duration.
High leverage amplifies both gains and losses—making risk management crucial.
Pros and Cons Summary
Perpetual Contracts
| Pros | Cons |
|---|---|
| No expiry – ideal for long-term holds | Ongoing funding costs can erode profits |
| High leverage increases capital efficiency | More volatile due to speculative nature |
| No need to manage delivery logistics | Requires active monitoring of funding intervals |
Delivery Contracts
| Pros | Cons |
|---|---|
| Price converges to spot at expiry – reduces basis risk | Must manage timing around expiration |
| No funding fees – cheaper to hold short-term | Higher margin requirements |
| Enables real-world asset transfer (for institutional users) | Risk of forced liquidation or unintended delivery |
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Which Contract Should You Choose?
The answer depends on your trading style, objectives, and risk appetite.
Choose Perpetual Contracts If You:
- Want to hold positions indefinitely.
- Prefer high leverage and frequent trading.
- Don’t want to worry about expiration dates or settlement processes.
- Are comfortable managing periodic funding payments.
These are popular among day traders, swing traders, and speculators focused on price action rather than asset ownership.
Choose Delivery Contracts If You:
- Need exposure tied to a specific future date (e.g., hedging quarterly revenue).
- Work with institutions requiring transparent settlement timelines.
- Want to avoid funding rate uncertainty.
- Are preparing for actual crypto receipt or delivery (rare for retail).
They’re commonly used in hedging strategies, arbitrage plays, or compliance-driven environments.
Frequently Asked Questions (FAQ)
Q: Do perpetual contracts ever expire?
No, perpetual contracts do not have an expiration date. However, they are subject to mark price adjustments and funding rate settlements every 8 hours to maintain alignment with the spot market.
Q: How are delivery contracts settled on OKX?
Most delivery contracts on OKX are settled in cash using USDT or the base cryptocurrency (like BTC), depending on the pair. Physical delivery applies only to specific inverse contracts where the quote currency is crypto.
Q: Can I lose money from funding rates in perpetual contracts?
Yes. If you hold a long position when funding rates are positive, you’ll pay the rate. Conversely, holding a short during negative funding means paying the longs. Over time, this can impact profitability—especially in range-bound markets.
Q: Are delivery contracts safer than perpetuals?
Not necessarily. While delivery contracts lack funding fees, they introduce expiration risk and often require higher margins. Safety depends on your ability to manage timing, liquidity, and position size.
Q: What happens if I don’t close a delivery contract before expiry?
If you don’t close it manually, OKX will automatically settle your position at the final reference price. Any profit or loss is credited/debited instantly. You won’t receive physical coins unless it's a designated deliverable contract.
Q: Is leverage the same across both contract types?
No. Perpetual contracts usually offer higher maximum leverage compared to delivery contracts. Always check the current limits on OKX based on the asset and your account tier.
Final Thoughts
Both perpetual and delivery contracts play vital roles in a comprehensive crypto trading toolkit. Perpetuals offer flexibility, high leverage, and ease of use—perfect for dynamic market participation. Delivery contracts bring predictability, fixed timelines, and alignment with traditional futures principles—ideal for structured strategies.
Your choice should reflect your goals: Are you speculating on price? Or managing real economic exposure?
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By understanding these core differences—and using tools like stop-losses, take-profit orders, and funding rate trackers—you can trade smarter and stay ahead in volatile markets. Whether you're new to derivatives or refining your approach, knowing when to use each contract type is a cornerstone of successful trading on OKX.