Perpetual Futures (Crypto) Singapore
The Leveraged Crypto Contract With No Expiry Date, and Why MAS Restricts It
Category: DIGITAL ASSETS · Last updated: September 2026
A perpetual futures contract, or perpetual swap, is a derivative that lets a trader speculate on a cryptocurrency’s price using leverage, without ever having to hold the underlying coin and without a fixed expiry date, unlike traditional futures. A funding-rate mechanism periodically transfers payments between long and short holders to keep the contract price tethered to the spot price.
Not financial advice. All figures for educational reference only. Data as at September 2026.
Key Takeaways
- Unlike traditional futures, a perpetual futures contract never expires or settles; positions can theoretically be held indefinitely as long as margin requirements are met.
- A funding rate, paid periodically between long and short position holders, is the mechanism that keeps the perpetual contract’s price anchored close to the underlying crypto asset’s spot price.
- Perpetual futures are typically traded with leverage, meaning a small amount of margin controls a much larger notional position, amplifying both potential gains and potential losses.
- The Monetary Authority of Singapore treats leveraged crypto derivatives, including perpetual futures, as high-risk activities and has restricted retail access to them through licensed Digital Payment Token service providers since 2022.
- Because MAS-licensed platforms serving Singapore retail customers are barred from offering leveraged crypto trading, most Singapore-based retail exposure to perpetual futures happens through offshore exchanges, which carries additional regulatory and counterparty risk.
What Are Perpetual Futures?
A perpetual futures contract, commonly shortened to “perps,” is a type of derivative contract that allows a trader to take a leveraged long or short position on a cryptocurrency’s price without ever owning the underlying coin and without any fixed settlement or expiry date. This makes it structurally different from a traditional futures contract, which has a specific expiry date on which the contract settles and the position closes automatically.
Because a perpetual contract has no expiry, exchanges needed a mechanism to prevent its price from drifting indefinitely away from the actual spot price of the underlying asset. The solution is the funding rate: a periodic payment, usually exchanged every few hours, between traders holding long positions and traders holding short positions. When the perpetual contract trades above spot price, longs pay shorts; when it trades below spot, shorts pay longs. This constant rebalancing pressure keeps the contract price closely tethered to spot over time.
Perpetual futures are almost always offered with leverage, sometimes extremely high leverage on offshore platforms, meaning a trader can control a large notional position with a relatively small amount of posted margin. This is what makes them attractive to speculators seeking amplified returns, and simultaneously what makes them capable of wiping out a trader’s entire margin balance through liquidation if the market moves against the position.
How Do Perpetual Futures Work for Singapore-Based Traders?
The Monetary Authority of Singapore regulates cryptocurrency-related services under the Payment Services Act, and licensed Digital Payment Token (DPT) service providers serving Singapore retail customers are explicitly restricted from offering leveraged trading, credit facilities for crypto purchases, or perpetual futures and other derivatives to retail clients. MAS has repeatedly stated that these products carry outsized risk for retail investors given crypto’s inherent volatility, and the restriction has been in place since guidelines tightened in 2022.
As a result, MAS-licensed platforms operating in Singapore, the kind an ordinary retail investor would open an account with locally, generally do not offer perpetual futures trading to retail users. Traders who want exposure to perpetual futures typically do so through offshore exchanges that are not licensed by MAS, which sit outside Singapore’s regulatory perimeter and consumer protection framework entirely.
This has real practical consequences: funds held on an unlicensed offshore platform are not covered by any Singapore regulatory safeguard, disputes are governed by the offshore platform’s own terms and jurisdiction, and MAS has publicly and repeatedly cautioned the public against trading on unregulated platforms, including through the Investor Alert List it maintains.
Perpetual Futures Example
A trader opens a long perpetual futures position on Bitcoin worth USD 10,000 in notional exposure, posting USD 1,000 in margin, effectively using 10x leverage. If Bitcoin’s price rises 5%, the position gains roughly USD 500, a 50% return on the posted margin. If Bitcoin instead falls 10%, the position’s losses approach the full USD 1,000 margin, and the exchange automatically liquidates the position to prevent the account from going negative.
Throughout the time the position is open, the trader also periodically pays or receives the funding rate depending on whether the perpetual contract is trading above or below spot price and whether their position is long or short, an ongoing cost (or occasional income) separate from the price movement itself.
Advantages of Perpetual Futures
- No expiry to manage. Unlike traditional futures, a trader never has to roll a perpetual position into a new contract before expiry, simplifying position management for those who want continuous exposure.
- Deep liquidity on major platforms. Perpetual futures on large global exchanges for major cryptocurrencies like Bitcoin and Ethereum are among the most liquid derivative instruments in crypto, typically with tight bid-ask spreads.
- Capital-efficient exposure. Leverage lets a trader gain large notional exposure with comparatively little capital, which can be useful for hedging an existing spot position without selling it.
- Two-way market. Perpetual futures make it straightforward to profit from falling prices via a short position, something that is harder to achieve by simply holding the underlying coin.
Risks and Limitations
- Not available to retail on MAS-licensed platforms. Since 2022, MAS-regulated Digital Payment Token providers cannot offer leveraged crypto derivatives to retail customers in Singapore, pushing interested traders toward unregulated offshore venues.
- Liquidation risk from leverage. Because positions are leveraged, even a moderate adverse price move can trigger automatic liquidation, wiping out the posted margin entirely.
- Offshore platforms carry counterparty and regulatory risk. Trading on an unlicensed exchange means no Singapore regulatory protection, no deposit guarantees, and full exposure to that platform’s solvency and governance.
- Funding rate costs can erode returns. Holding a position on the wrong side of persistent funding rate imbalances (common during strongly trending markets) creates an ongoing drag that compounds over time.
Perpetual Futures vs Traditional (Dated) Futures
| Feature | Perpetual Futures | Traditional Futures |
|---|---|---|
| Expiry date | None | Fixed settlement date |
| Price anchoring mechanism | Periodic funding rate payments | Convergence to spot price near expiry |
| Available to SG retail via MAS-licensed platforms | No | Certain regulated futures products may be, subject to licensing |
| Typical leverage | Often very high on offshore platforms | Varies, generally lower and margin-regulated on licensed exchanges |
| Rollover needed? | No | Yes, to maintain continuous exposure |
Source: TKN research, compiled September 2026.
The Bottom Line
Perpetual futures are a structurally clever product, but MAS has drawn a clear line: they are not something Singapore’s licensed platforms can offer retail investors, and trading them means stepping outside the regulatory perimeter entirely. Anyone considering it should understand that both the leverage and the offshore venue materially raise the risk profile.