How to choose an exchange for futures: security, reserves and license

This comes first, because it decides whether you have anyone to complain to. Check which company you’re signing up with: it’s usually in the terms of use, and it changes from country to country.

• In the European Union, the crypto side needs a MiCA authorization. Futures are derivatives and MiCA doesn’t cover them: offering them also requires a MiFID II license. Some exchanges only offer a limited version of their futures in Europe, or none at all.
• Outside the European Union, find out whether your country has a register of crypto providers and whether the company is on it. In Argentina, for example, it’s the CNV’s PSAV register.
• Check the warning list of your country’s regulator: it names the companies offering services without permission.

An exchange holds its customers’ money. Proof of reserves shows that it has at least as much as their balances add up to. Look at three things:

• The ratio for each coin: 100% or more. Below that, it holds less than it owes.
• How often it’s published: once a month is normal. One from a year ago says little.
• Whether you can check your own balance in it, with the tool the exchange provides.

It’s a snapshot of one day: it helps, but it doesn’t tell you what happens the rest of the month or all of the exchange’s debts. An exchange that doesn’t publish it is asking you to trust it without showing you anything.

• Find out whether it has been hacked and how it responded: whether it paid customers back or not.
• Check whether it has a fund to cover customers in case of a theft. That’s not the same as the liquidation insurance fund, which covers the losses from liquidations that can’t be closed in time.
• Always turn on two-factor authentication and, if it’s available, a withdrawal address allowlist.

In futures you pay one fee when you open and another when you close, on the full size of the position. Each exchange has two prices: one for orders that wait in the book (maker, like a limit order) and a higher one for orders that fill at once (taker, like a market order).

The difference looks small and isn’t. Between 0.02% and 0.06%, with $10,000 of volume a day, that’s $120 in 30 days. Compare what you’d pay with the way you trade in the fee calculator. Funding is separate: it isn’t an exchange fee but a payment between traders (it’s in the guide to funding).

• Liquidity: with few orders in the book, a market order fills at several prices, worse than the one you see. You notice it more in fast moves and in small coins.
• Exit orders: you should be able to set the stop loss and the take profit when you open the position.
• Demo account: to practice on the same screen with play money before you risk your own.
• Maximum leverage doesn’t count. If you’re starting out, don’t go above 20x, and they all offer that.

Authorized exchanges have to verify who you are (KYC) before letting you deposit, trade or withdraw. It’s a ten-minute hassle and it also protects you: if an exchange lets you trade futures without asking you for anything, it most likely has no license where you live.

• It promises you gains or fixed returns.
• It gives you free money with conditions that stop you from withdrawing it.
• It doesn’t appear in any register and doesn’t say which company is behind it.
• It delays withdrawals or makes them difficult. Before depositing a lot, try withdrawing a small amount.

In exchanges you have the ones we review side by side: their futures fees, whether they’re authorized under MiCA and whether they appear in Argentina’s PSAV register, with a profile of each one and comparisons between them. Before you open your first trade, read the guide to crypto futures from scratch.