USDT-M Futures vs Coin-M Futures: What Are the Differences?

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HTX Futures offers various virtual asset derivatives products, including USDT-margined futures and coin-margined futures. Traders can choose to long or short futures products based on their market views to profit from up or down markets. Let's discover more about these two types of futures contracts by digging into the differences in some of their key features.

The key features and key differences:

1. Quote currency: USDT-margined futures contracts are denominated in USDT while coin-margined futures are denominated in USD.

2. Collateral assets: All USDT-margined futures use USDT as collateral, therefore, users only need to hold USDT to trade a variety of USDT-margined futures contracts, including delivery futures and perpetual futures. While coin-margined futures use the underlying virtual assets as margin/collateral, thus users need to hold the corresponding virtual assets before trading the coin-margined futures contracts they want. For example, users need to deposit BTC as collateral assets before trading coin-margined BTCUSD perpetual futures.

3. Collateral asset depreciation: When the market goes down, the risks of collateral/margin depreciation for these two types of futures contracts are different. To be specific, the collateral assets of the coin-margined futures contract will be affected by the price of its base currency. While the USDT collateral assets for USDT-margined futures won’t be affected. 

4. PnL settlement: PnL of USDT-margined futures contracts is calculated and settled in its quote currency USDT; while PnL of coin-margined futures contracts is calculated and settled in its underlying virtual asset.

Typically in futures trading, if most of your holdings are some certain tokens, such as BTC or ETH, you should trade coin-margined futures; If you only hold stablecoin USDT without any other virtual asset, it's advisable you only trade USDT-margined futures. And yes, USDT-margined futures are friendlier for futures beginners.