What Are Derivatives?

A derivative is a financial contract whose value is derived from an underlying asset. Rather than buying or selling the asset directly, you trade a contract that tracks its price.

The two most common types of derivatives in crypto are perpetual futures (perps) and options. This guide will teach you both, starting with perps and building up to options trading on Abyssal.fi.

Why derivatives? They allow you to hedge risk, gain leveraged exposure, or profit from volatility — all without holding the underlying asset.