WTF Are Perps?
Perpetual futures, explained, and what the "onshore" moment means for everyday traders.
If you spend any time near crypto these days, you have seen the word perps everywhere, usually with zero explanation, as if everyone already got the memo. And in 2026, the word got louder for a reason. One after another, the biggest names in U.S. trading raced to bring perps "onshore," and a federal regulator quietly cleared the runway for them to do it.
So let's break it down in plain English. No finance degree required. And to be clear up front, this is an explainer, not advice. We are not telling you to trade anything. We just want you to actually know what the word means when it floods your feed.
So WTF is a perp?
Perp is short for perpetual future.
A future (or futures contract) is basically a bet on where the price of something will go. You are not buying the actual thing. You are trading a contract tied to its price. Traditional futures come with an expiration date, a day when the bet settles up and the contract ends.
The "perpetual" part is the twist. There is no expiration date. The bet never has to end. You can hold a perp for five minutes or five months and close it whenever you want, as long as you have enough money backing it. That is the whole headline: a futures bet that just keeps going.
So a Bitcoin perp lets you trade on the price of Bitcoin without actually owning any Bitcoin, and without a deadline forcing you to cash out.
The part that keeps perps honest: the funding rate
Fair question: if a perp never expires, what stops its price from drifting off into fantasyland, far from the real price of the thing it tracks? The answer is a clever little mechanism called the funding rate. At regular intervals, often every eight hours, a small payment passes between the two sides of the bet: the people betting the price goes up (longs) and the people betting it goes down (shorts). If the perp's price floats above the real price, the up-betters pay the down-betters, and vice versa. This constant little nudge keeps the perp tethered to reality, like a leash gently tugging a balloon back down.
You do not need to memorize the mechanics. Just know two things. The funding rate is the invisible string keeping a never-ending bet from floating away, and it is also a real cost if you are on the paying side. Hold a position long enough during a strong one-way market, and funding alone can quietly eat several percent of your position in a single week, totally separate from whether the price moved.
The word you can’t skip: leverage
This is the part that makes perps thrilling to some people and terrifying to others. Perps let traders use leverage, which is essentially borrowing to make a much bigger bet than the cash they actually put down. You post a fraction of the position, called margin, and the platform lets you control a much larger amount. On some platforms, leverage can reach 50x or more.
Why does that matter? At 10x leverage, a 10 percent move against you can wipe out your stake entirely. At 50x, a move of only about 2 percent the wrong way is enough to wipe you out. When that happens, the platform does not wait for you to fix it. It automatically closes your position to keep your account from going negative, a forced exit called liquidation.
And this is not a rare edge case. Industry data shows that accounts using leverage above 10x see liquidation rates above 40 percent within their first month of trading. In plain terms, a big share of beginners who reach for high leverage lose their money fast.
How a perp is different from just buying crypto
If you buy Bitcoin on an app and hold it, you own the actual asset. No borrowed money, no liquidation, no funding cost. The worst case is the price drops and you are down on paper.
A perp is a different animal. You never hold the coin. You are trading the price, with leverage and ongoing costs, and you can lose everything you put in even if you were "mostly right" but got the timing wrong. Same asset, completely different risk.
Why perps suddenly went onshore
For years, most perpetual futures trading happened on offshore platforms, outside the reach of U.S. regulators. The market is massive. Annual perpetual futures volume topped $60 trillion in 2025, much of it on offshore venues like Hyperliquid that U.S. customers could not easily or legally use.
Then the regulatory picture shifted fast.
In May 2026, the Commodity Futures Trading Commission (CFTC) approved the first Bitcoin perpetual contract at a regulated U.S. firm, the prediction market platform Kalshi, which saw more than $1 billion in trading volume within a week. The agency also opened a path for Coinbase to connect U.S. customers to global perpetual markets.
In June 2026, Kraken went live with CFTC-regulated perps for U.S. customers through Kraken Pro, built on its purchases of the futures firms Bitnomial and NinjaTrader. The first lineup covers major cryptocurrencies including Bitcoin, Ether, and Solana, with more planned.
Around the same time, the CFTC issued a no-action letter, a signal that it will not pursue enforcement, letting exchanges strip the expiration dates off certain existing futures and turn them into "true" perpetuals, as long as they meet customer-protection conditions like notifying traders with open positions, giving them a chance to exit, and providing risk disclosures.
Translation: a product that used to live almost entirely offshore is now showing up, legally, inside familiar U.S. apps.
The neutral read: two honest sides
Supporters argue that bringing perps onshore is a win for everyday traders. The demand already existed, U.S. users were already reaching offshore platforms with little oversight, and a domestic, CFTC-regulated framework adds disclosures, guardrails, and accountability those offshore venues never offered. From this view, regulation is simply catching up to what people were already doing.
Critics see real reason for caution. The nonprofit watchdog Better Markets criticized regulators for approving them without requiring enhanced, plain-language disclosures that ordinary people could actually understand. Their worry is simple: products that allow up to 50x leverage can vaporize an account on a small price move, and a regulatory stamp can read to a beginner as a safety endorsement when it is not one.
Both things can be true at once. More oversight than before, and still genuinely risky.
The bottom line for a new trader
A few grounded takeaways, none of which tell you what to do with your money.
- A regulated label changes who is watching the venue. It does not change the math of the product. A 2 percent move can still end a 50x position no matter which logo is on the app.
- The risks that hurt beginners most are often the quiet ones. Liquidation gets the headlines, but funding costs erode positions slowly, and high leverage shrinks your margin for error to almost nothing.
- "Available to me now" is not the same as "right for me now." The fact that perps have moved onshore is a reason to understand the mechanics before tapping anything. If you take one idea away, make it this. A perp is a leveraged bet on price with no expiration and ongoing costs, and the very features that make it powerful are the ones that make it unforgiving. That is the goal here. Not a verdict, just clarity. WTF are perps? Now you actually know.
Disclaimer : Market Crush reports what prediction markets and financial trends say about pop culture, for informational and educational purposes only. This is not financial, investment, legal, or betting advice, and not a recommendation to trade, bet, or invest. We report on market data; we do not facilitate or recommend trading of any kind. Odds move constantly and are current only as of the time noted.
Sources
Better Markets. (2026). Retail-investor risk in onshore perpetual futures. Better Markets. https://bettermarkets.org
CoinDesk. (2026). Kraken launches U.S. perps; CFTC clears first regulated perpetual. CoinDesk. https://www.coindesk.com
Commodity Futures Trading Commission. (2026). No-action letter on true perpetual contracts (Press Release No. 9252-26). CFTC. https://www.cftc.gov
CryptoSlate. (2026). Perps, funding, and liquidation explained. CryptoSlate. https://cryptoslate.com
Kalshi. (2026). Perpetual futures explained. Kalshi. https://kalshi.com
MetaMask. (2026). Leverage and margin: A beginner's guide. MetaMask. https://metamask.io