Perpetuals

Definition ∞ Perpetuals, or perpetual futures contracts, are derivative instruments that allow traders to speculate on the future price of an asset without an expiration date. They are commonly traded on cryptocurrency exchanges and feature mechanisms like funding rates to maintain alignment with the underlying asset’s spot price. These contracts offer leverage but also carry significant risk.
Context ∞ Perpetual futures are a dominant trading instrument in the cryptocurrency derivatives market, often accounting for a substantial portion of trading volume. News coverage frequently highlights their role in price discovery, market volatility, and the potential for liquidations. Discussions around perpetuals often involve regulatory considerations, the impact of funding rates on market sentiment, and their use in sophisticated trading strategies.

A striking abstract composition features a central, irregular, deep blue translucent mass, representing a core blockchain ledger or liquidity pool. Embedded within are sharp, white crystalline structures, symbolizing cryptographic primitives, transaction blocks, or validator stakes. A white, frothy base emanates, illustrating network activity and transaction throughput within a decentralized network. A spherical element suggests a governance token or oracle node, while a cloud-like form signifies decentralized storage or off-chain computation. This visual metaphor encapsulates the intricate tokenomics and consensus mechanisms driving a robust Web3 infrastructure.

→Risk

→Order Book Spoofing

→Whale Activity

Hyperliquid Users Liquidated by Coordinated Perpetual Exchange Price Manipulation

Market manipulation exploiting thin liquidity and high leverage is the fastest vector for mass user liquidation, circumventing smart contract security.