> ## Knowledge Base Index > Fetch the complete knowledge base index at: https://support.x4t.com/sitemap.xml > Use this file to discover available pages before exploring further. > Pure-Markdown content can be obtained by appending a '.md' suffix to the content URLs listed in the sitemap (without the trailing slash). # Perpetual Trading and how it works # Perps on X4T: profit when the price goes up… and also when it goes down **With Perps, your $100 can work as if it were up to $4,000.** Take a position on Bitcoin and other cryptocurrencies and profit when they rise and also when they fall, without having to buy them. All from your X4T account and with USDC. In this article, we explain everything from the simplest to the most detailed: what Perps are, how they work under the hood, and how to open your first position. > ⚠️ **Important: Perps are a high-risk product.** The multiplier increases your gains, but also your chance of losing. You can lose everything you put into a position within minutes or even seconds. If you don't fully understand how it works, you can lose money very quickly. Read the full article before trading. --- ## 1. What are Perps? (the short version) A Perp lets you profit from the **price movement** of a crypto. At its core it's simple, similar to a bet: you choose whether you think the price will **go up** or **go down**. If you're right, you win. If you're wrong, you lose. **What's the difference from regular trading?** Very simple: in perpetuals trading, your bet can be multiplied up to **40x**, without you having to put in that extra money yourself. It works in 4 steps: 1. **You put in an amount**, for example $100 in USDC. 2. **You choose the multiplier**, from 1x up to 40x on Bitcoin. 3. **You choose the direction:** - **Long**: you think the price will **go up**. - **Short**: you think the price will **go down**. 4. **You follow your position** in real time and **close it whenever you want**. There are only two options: up or down. Now let's look at what happens under the hood. --- ## 2. How does it work? The multiplier (leverage) Let's say you have **$100** and choose a multiplier of **20x**. With that, you trade as if you had **$2,000**. Where do the other $1,900 come from? Think of it this way: - **Your $100 is held as collateral.** It's your "insurance" for the trade. On the platform you'll see it as *margin*. - **The remaining $1,900 is put up by the market.** It's not a traditional loan: there's no interest and no installments. Why does the market put up that money? Because it **takes no risk**. If the price moves against you, the position closes automatically before the loss exceeds your collateral. This is called **liquidation**. In other words: - If the price moves in your favor, **all the profit is yours** (minus a fee), and it's calculated on the $2,000. - If the price moves against you and the loss gets close to the amount of your collateral, the position closes on its own. **You lose your $100** and the market gets its $1,900 back, because the position (or the "bet") was closed automatically before the remaining $1,900 were at risk of loss. Only your deposited $100 collateral is used up. **Costs:** - **Fee:** X4T charges a fee when you open and when you close the position. It's calculated on the **total value** of the position ($2,000 in the example), not just on your $100. You always see it on the page before confirming. - **Funding:** a small periodic payment between those who are Long and those who are Short. It keeps the Perp's price aligned with the actual price of the asset. Depending on the market, you may pay it or receive it. In the Perps window you'll see the rate and a countdown to the next payment. **In short: X4T gives you the power to multiply your money, and the risk multiplies in exactly the same way – but it never exceeds your collateral. If, for example, you open a position with $100 and 20x, your maximum risk is always just those $100, never the full $2,000.** | In any combination, your only risk is losing the collateral you deposited. --- ## 3. Practical example, step by step ![Perp visualisation](https://storage.crisp.chat/users/helpdesk/website/-/f/6/d/f/f6dfb1ee704cb800/perps-1-posicion-20x_1jcpcp0.png) ### Scenario A: What would a profit look like with perpetuals? ![perp visualisation A](https://storage.crisp.chat/users/helpdesk/website/-/f/6/d/f/f6dfb1ee704cb800/perps-2-escenario-a-sube_13upyhp.png) ### Scenario B: What would losing / being liquidated look like with perpetuals? ![perp visualisation B](https://storage.crisp.chat/users/helpdesk/website/-/f/6/d/f/f6dfb1ee704cb800/perps-3-escenario-b-liquidacio_1jkkb5l.png) ### Scenario C: You close early You don't have to wait for any extreme. You can close the position at any time to lock in a profit or to cut a loss before it reaches liquidation. ||| It's important to keep in mind that when you close the position successfully, you only receive your collateral plus the profit generated by the position, not the funds the market lent you. If, for example, your $100 position at 20x gains 10%, you receive your initial $100 plus 10% of the $2,000, i.e. $300 in total. You do not also receive the market's $1,900. | What if you think the price will go down? You choose Short instead of Long. Everything works the same, but in reverse: you win if the price falls and lose if it rises. --- **The multiplier determines how close liquidation is:** | Multiplier | With $100 you trade | Adverse move that triggers liquidation (approx.; also shown on the website before you open the position) | | ---- | ---- | ---- | | 2x | $200 | 50% | | 10x | $1,000 | 10% | | 20x | $2,000 | 5% | | 40x | $4,000 | 2.5% | *Approximate values. You'll see the exact price under "Estimated liquidation price" before confirming.* It's a simple, transparent system with no tricks: we give you the means to amplify your money, and the risk is amplified to the same degree. --- ## 4. Spot vs. Perps: pros and cons | | **Spot (regular purchase)** | **Perps** | | ---- | ---- | ---- | | **What you do** | You buy the crypto. It's yours, just like when you buy gold or stocks. | You trade on the price without buying the crypto. Similar to "betting". | | **When you win** | Only if the price goes up. | Whether it goes up or down, depending on whether you choose Long or Short. | | **Power of your money** | 1x: what you put in is what you trade. | Up to 40x on BTC: with $100 you trade up to $4,000. | | **If the price moves against you** | You can wait as long as you want. The loss only becomes real when you sell for less than you paid. | Depending on the multiplier, the position may close automatically and you lose your collateral. | | **When it ends** | When you sell. | When you close it, or automatically if it gets liquidated. | **A point in your favor:** on X4T, Perps use **Isolated** mode. Each position has its own collateral. If a position is liquidated, you only lose what you put into it. The rest of your balance and your other positions are not affected. --- ## 5. Before you start - **You need USDC on the Arbitrum network.** You can get it via *Deposit* or *Trade*. If you send it from another wallet or exchange, always choose the **Arbitrum** network. - **Always check the "Estimated liquidation price" before confirming.** It's the price at which your position closes automatically and you lose your collateral. It's the most important figure in the order. - **You can lose the entire collateral of a position.** If it's liquidated, that money doesn't come back. - **Only invest money you're willing to lose.** - **Know the costs:** you pay fees when opening and closing, and funding while the position is open. --- ## 6. How do I use the Perps window? **1. Go to Perps** Log in and open the **Perps** section (marked as NEW). You'll see the market (for example, *BTC/USD Perpetual – USDC margin*), the Mark price, the 24h change, the volume, the open interest and the *Funding / Countdown*. **2. Choose direction and order type** - **Long:** you win if the price goes up. - **Short:** you win if the price goes down. - **Market:** executes at the current price. - **Limit:** executes only at the price you specify. **3. Set the multiplier and size** - Choose the leverage with the slider or the buttons: 1x, 2x, 10x, 20x, 40x. - Under **Size**, enter how many USDC you want to use as collateral (margin). - You can use the percentages 25%, 50%, 75% or Max. - Check **Available to trade** and **Required margin**. **4. Review the details before confirming** In the **INDICATIVE** panel you'll see: - Order value - Required margin - **Estimated liquidation price** - Fees - Maximum slippage Keep in mind that the higher the multiplier, the closer the liquidation price is to the current price. **5. Open the position** Press the **Long BTC – Market** button (or Short / Limit, depending on what you chose). The position appears in the **Positions** tab. There you'll see your **PnL** in real time, i.e. how much you're gaining or losing at that moment. Every price movement is reflected immediately. You can close the position whenever you want. --- ## Risks: what you need to know - **The multiplier works in both directions.** - **Liquidation can be very fast.** With high multipliers, a small move is enough. When the market moves a lot, a position can be liquidated seconds after it's opened, before you have time to react. - **You can lose 100% of the collateral** of each position. - **Fees and funding** also reduce your result, especially if you trade often or keep positions open for a long time. - **Inform yourself before trading.** Many people trade Perps every day, but doing so requires knowing what you're doing. Understand how liquidation works and watch how the market is moving before opening a position. Many people underestimate how quickly a position can be liquidated. - **Only invest what you're willing to lose.** --- With Perps on X4T, every price movement can be an opportunity, up or down. You choose the direction, the multiplier and when to exit. > **Legal notice:** X4T provides tools and information but is not a financial advisor. Nothing in this article is investment advice. Perps are a **high-risk** product: leveraged trading can lead to the total loss of your collateral in a very short time. You make your decisions on your own responsibility.