Blockchain allows protocols for finance. Derivative contracts like perpetual futures are inherently better than old-school futures. The innovation is much more rapid. Building a new exchange becomes permissionless. Assets can flow from old exchanges to new, or be moved around to many rapidly. All of this is simply better than the current exchange situation - 24/7 trading, low fees, rapid innovation, easy capital formation. Finance will move to the crypto rails because it’s better.
How is a perpetual futures contract inherently better than "old-school futures"? It is my understanding what cyrpto calls a perpetual future _isn't_ a future which makes them difficult to compare. I'm reading this comment as if perpetual futures are going to replace our current futures system somehow, and I don't see this possibility.
Don't we have 24/7 trading without the block chain? And low fees?
It appears all the many of these benefits you mention are for those just transacting in a crypto currency, and not for the other 99% of finance transacting in other currencies (and physical goods).
> Derivative contracts like perpetual futures are inherently better than old-school futures.
Can you elaborate on this? Physically settled futures are important to producers and consumers of commodities. I can imagine that replacing these with a cash settled contract might increase spot volatility.
You are right, it is a different product, it isn't inherently better simply because it's perpetual. But it is quite interesting and provides different trading strategies to the standard futures contract. See https://www.bitmex.com/app/perpetualContractsGuide for a good explanation for how Bitmex's implementation works which is the most popular version.
I think a lot of exotic derivative contracts will be innovated in the crypto exchange networks, and those that become popular will eventually applied to traditional commodities and equities once the bureaucracy comes up with regulations in 5 to 10 years.
