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Bybit Futures Trading Tutorial: A Step-by-Step Guide

Written by Charles

Written by:

Charles

Hi, I'm Charles Johns, a Finance graduate with a specialization in Financial Management from the University of Chicago. My journey through financial markets has fueled a passion for both traditional and digital assets, where I continuously explore evolving investment opportunities. As an active trader and cryptocurrency enthusiast, I strive to bridge the gap between complex financial concepts and practical, real-world applications. My goal is to empower everyone, whether seasoned investors or newcomers, with valuable insights and knowledge to confidently navigate the world of finance and crypto investing.

Expert reviewed

Expert Reviewed

This article has been reviewed by crypto market experts at SCM to ensure all the content, sources, and claims adhere to the highest standards of accuracy and reliability.

Last Updated on January 25, 2025

  • Founded in 2018 and headquartered in Singapore, Bybit has rapidly built a reputation as a leading cryptocurrency exchange known for its robust futures trading platform.

    With over 2 million users and a daily trading volume exceeding $10 billion, Bybit stands out for its low fees, high liquidity, and cutting-edge features, making it a preferred choice for many traders worldwide.

    Trading futures on Bybit presents an array of possibilities for both beginners and seasoned investors.

    In this tutorial, you’ll gain insights into the essential strategies for trading on Bybit, from trend following and breakout trading to more complex approaches like spread trading and pullback trading.

    By the end of the article, you will understand how to navigate futures trading on Bybit effectively, maximizing your potential returns while managing risk.

    How to Trade Crypto Futures on Bybit: Bybit Futures Trading Strategy & Basics

    Our 2025's Recommendation

    • Upto 100x Leverage for BTC

    •  Supports over 300+ crypto trading pairs

    • Fees starting at 0.075% for futures

    • Strong security features

    A solid trading strategy and risk management plan are crucial for success in Bybit futures trading. Without these, you risk making impulsive decisions that can lead to substantial losses.

    Common Futures Trading Strategies:

    • Trend Following: Identify and follow the market momentum. This involves using tools like the 200-period simple moving average on a daily chart. If the price is above this average, the trend is up.
    • Scalping: Focus on profiting from small price changes. This requires quick decision-making and precise execution.
    • Hedging: Protect your investments from adverse price movements. This can be achieved by taking opposite positions in the market.

    Understanding Index Price (an average of prices from various exchanges), Fair Price (used to avoid unnecessary liquidations), and Funding Rate (periodic payments between long and short traders) is essential.

    These concepts help you make informed trading decisions.

    To apply a strategy on Bybit:

    1. Set Up Your Account: Register and deposit funds into your Bybit account.
    2. Select Your Contract: Choose the appropriate futures contract based on your analysis and strategy.
    3. Analyze the Market: Use tools like moving averages, MACD, RSI, and trend lines to identify potential entry and exit points.
    4. Place Orders: Utilize the Bybit order calculator to estimate potential profits and losses before placing orders.
    5. Monitor and Adjust: Continuously monitor your trades and adjust your strategy as required.

    Tips and Best Practices:

    • Use Stop-Loss Orders: Always set up stop-loss orders to minimize potential losses.
    • Avoid Overleveraging: High leverage can amplify both gains and losses.
    • Stay Informed: Keep up-to-date with market news and trends.
    • Practice Discipline: Stick to your strategy and avoid emotional trading decisions.

    Following these guidelines can enhance your trading performance and manage risks effectively.

     

    How to Create an Account on Bybit

    Creating an account on Bybit is straightforward. You can register through their website or mobile app. Follow these steps:

    1. Website Registration:
      • Visit the Bybit website.
      • Click on the Sign Up button at the top right corner.
      • Choose to sign up using either your email address or phone number.
    create bybit account
    1. Mobile App Registration:
      • Download the Bybit app from your app store.
      • Open the app and tap on the Assets section at the bottom right.
      • Select the Sign-Up button from the upper right corner.
      • Sign up using your email address or phone number.

    After entering your details, click Sign Up. You may be prompted to enter a referral code, but this is optional. You can also use Bybit refferal code to get welcome bonus.

    Verification Process

    To enhance your account security, Bybit requires identity verification (KYC). You need to:

    1. Submit Identification:
      • Upload a government-issued ID (such as a passport or driver’s license).
      • Take and upload a selfie for facial recognition.
    2. Security Measures:
      • Enable Two-Factor Authentication (2FA) for an extra layer of security.
      • Regularly update your password and be cautious of phishing attempts.

    Referral Program and Bonuses

    Bybit offers a referral program where you can earn bonuses. When you sign up using a referral code, you may receive a bonus credited to your account.

    Formatting Example

    Platform Steps
    Website Sign Up > Email/Phone > Confirm
    App Assets > Sign Up > Email/Phone > Confirm

    These steps ensure your account is set up securely and you are ready to start trading futures on Bybit.

     

    How to Deposit and Withdraw Funds on Bybit

    deposit on bybit

    To deposit funds on Bybit, start by logging into your account.

    Click on Assets located at the top menu and select Deposit. Deposit the cryptocurrency like BTC, USDC, or another coin you wish to deposit. Bybit will provide a wallet address for the chosen cryptocurrency.

    On mobile: Open the Bybit app, tap on Assets at the bottom right, and select Deposit. Deposit the coin and chain type, then complete the deposit process by following the instructions.

    Bybit offers fiat deposits through Credit/Debit Cards, fiat transfers, or third-party payments. Follow the prompts in the Deposit section to complete the transaction.

    When withdrawing funds, go to Assets, then select Withdraw. Choose the cryptocurrency to be withdrawn. Enter the wallet address and the amount. Be aware of the withdrawal fees and minimum withdrawal limits, which vary based on the currency.

    Bybit supports several payment methods:

    • Cryptocurrency deposits and withdrawals: Typically processed within minutes to a few hours.
    • Fiat deposits via Credit/Debit Card, Bank Transfer, or Third-Party Payments: Processing times may vary from instant to a few days.

    Processing times and fees depend on the selected payment method. For cryptocurrencies, a small network fee is applicable. Fiat deposit and withdrawal fees are stated during the transaction process and vary based on the payment provider.

    Here’s a quick summary of supported payment methods:

    Payment Method Deposit Withdraw
    Crypto Yes Yes
    Credit/Debit Card Yes No
    Bank Transfer Yes No
    Third-Party Payment Yes No

    Monitor your transactions to ensure they are processed correctly and within the expected time frame.

     

    How to Transfer Funds to the Futures Wallet

    Bybit provides two main types of wallets: the Spot Wallet and the Futures Wallet. The Spot Wallet is for regular trading and holding cryptocurrencies, while the Futures Wallet is specifically for trading futures contracts.

    To transfer funds to your Futures Wallet, follow these steps:

    1. Log in to your Bybit account.
    2. Navigate to the Assets section at the top right-hand corner of the homepage.
    3. Under the Assets page, locate and click on Transfer.
    4. In the pop-up window, select Spot Wallet as the source and Futures Wallet as the destination.

    Supported currencies include popular cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), and USDT (Tether). Always check the most up-to-date list of supported currencies on the Bybit platform.

    Minimum and Maximum Transfer Amounts

    • Minimum Amount: The minimum transfer amount is typically negligible, often around 0.001 BTC or its equivalent.
    • Maximum Amount: Generally, there isn’t a maximum transfer limit, but large transfers might require additional verification.

    By sticking to these instructions, you can efficiently transfer funds and start trading futures on Bybit.

     

    How to Choose Between Inverse and Linear Futures

    Inverse Futures and Linear Futures offer different mechanisms for trading on Bybit. Understanding these differences helps you make the right choice.

    Inverse Futures Contracts are denominated in the base cryptocurrency. For example, trading BTC/USD contracts means you post a margin in BTC. This is advantageous if you want to increase your BTC holdings since profits and losses are directly tied to BTC.

    Linear Futures Contracts are denominated in USDT. This is preferable if you prefer stablecoins and want to minimize exposure to BTC’s volatility. Linear contracts simplify the calculation of profits and losses, as they are in a stable currency.

    Comparison of Inverse and Linear Futures

    Feature Inverse Futures Linear Futures
    Denomination Base cryptocurrency (e.g., BTC) Stablecoin (e.g., USDT)
    Margin and Settlement In BTC or other base crypto In USDT
    Volatility Exposure Higher due to crypto denomination Lower due to stablecoin denomination
    Profit Calculation It is more complex due to BTC margin use Simpler with USDT margin

    Advantages and Disadvantages

    • Inverse Futures Advantages
      • Profits increase your holdings in cryptocurrency
      • Suitable for long-term BTC enthusiasts
    • Inverse Futures Disadvantages
      • Complex profit/loss calculations
      • Higher exposure to cryptocurrency volatility
    • Linear Futures Advantages
      • More straightforward profit/loss calculations
      • Reduced volatility risk
    • Linear Futures Disadvantages
      • Profits in stablecoin, not increasing crypto holdings
      • Less beneficial in a bullish crypto market

    Examples of Contracts

    • Inverse Futures
      • BTC/USD
      • ETH/USD
    • Linear Futures
      • BTC/USDT
      • ETH/USDT

    Choosing between inverse and linear futures on Bybit depends on your risk tolerance and profit goals. Understanding each type will help you make an informed decision.

     

    How to Understand the Futures Trading Interface

    bybit ui

    The futures trading interface on Bybit is designed to be comprehensive yet intuitive.

    • Chart

    The chart displays the price movements of the selected futures contract. You can customize it with various technical indicators and drawing tools to analyze market trends. Switching between different timeframes helps in understanding long-term versus short-term price actions.

    • Order Book

    The order book shows a real-time list of buy and sell orders. The green side represents buy orders, and the red represents sell orders. Understanding the order book’s depth and spread helps gauge market liquidity and potential price movements.

    • Order Panel

    The order panel is where you place your trades. You can choose the type of order (market, limit, or conditional) and specify the quantity. Managing leverage is crucial; this section allows you to adjust it according to your risk appetite.

    • Position Panel

    The position panel displays your current positions, including entry price, unrealized P&L, and margin. This section is vital for managing your ongoing trades and making informed decisions on holding or closing your positions.

    • Trading Tools and Customization

    Bybit offers various tools, such as stop-loss and take-profit orders, to manage risk. You can customize the interface by rearranging panels and changing themes to suit your trading style.

    Understanding these components and how they interact is critical to effectively navigating the futures trading interface on Bybit.

     

    How to Place and Manage Orders on Bybit Futures

    When trading futures on Bybit, understanding different order types is essential.

    Limit Orders: A limit order lets you specify the price you want to buy or sell. It ensures the order executes at your desired price or better, but it may not fill if the market doesn’t reach that price.

    Market Orders: Market orders are executed immediately at the current market price. Use this when you want to enter or exit a position quickly, although it may incur higher costs due to slippage.

    Conditional Orders: Conditional orders trigger only when specific conditions are met. These are useful for stopping losses or making a profit without continuously monitoring the market.

    To place an order on Bybit:

    1. Navigate to the trading interface.
    2. Select the order type.
    3. Enter the price and amount.
    4. Confirm the details.
    5. Click Buy/Long or Sell/Short.

    Bybit allows you to use leverage, amplifying potential gains (or losses). Leverage means borrowing funds to trade a more prominent position than your initial margin allows. You can adjust leverage from the trading interface but manage it carefully to avoid liquidation.

    Read More: What Is Crypto Arbitrage Trading?

    Managing Orders and Positions:

    • Open Orders: Check this tab to see pending orders. Modify or cancel if needed.
    • Active Positions: View details such as entry price, leverage, and unrealized profit/loss.
    • To close a position, use the Close By Market option for immediate execution or set a conditional/limit order.

    Funding Rates and Settlement:

    Bybit uses funding rates to balance long and short positions. The rate can be positive or negative and is exchanged between traders every 8 hours. Futures contracts do not expire, but these funding payments ensure price alignment with the underlying asset.

    Understanding these concepts helps you trade more effectively and manage risks on Bybit.

     

    How to Use the Bybit Order Calculator

    The Bybit Order Calculator is an essential tool for futures trading, allowing you to plan your trades efficiently and efficiently.

    To access the Bybit Order Calculator:

    1. Locate the Bybit Calculator at the top right of the Order Zone on the Bybit platform.
    2. Click on the Calculator icon to open the tool.

    The calculator provides three main functions:

    • Profit/Loss Calculation: Determine potential gains or losses based on your entry and exit prices.
    • Target Price Calculation: Identify the target price to achieve a desired profit.
    • Liquidation Price Calculation: Avoid liquidation by knowing the price at which your position will be liquidated.

    Parameters

    • Entry Price: The price at which you enter the trade.
    • Exit Price: The price at which you plan to exit the trade.
    • Quantity: The amount of the asset you wish to trade.
    • Leverage: The multiplier that amplifies your position size.

    Example: Calculating Profit/Loss

    1. Entry Price: $10,000
    2. Exit Price: $11,000
    3. Quantity: 1 BTC
    4. Leverage: 10x

    Result: The calculator will show your potential profit or loss based on the provided parameters.

    Utilizing the Bybit Order Calculator helps you make informed decisions. Use it to plan your trades and manage risks effectively and carefully.

     

    How to Use the Bybit Futures Grid Bot

    The Bybit Futures Grid Bot is a convenient feature for automated futures trading designed to help you capitalize on market volatility.

    To begin, go to Bybit’s homepage. Click on the Trade option in the top menu. Select Trading Bot to reach the Bybit Trading Bot main page. Next, click the Create Now button next to the Futures Grid Bot.

    When setting up your Futures Grid Bot, you will need to configure several parameters:

    • Investment Amount: Determine how much you want to invest.
    • Grid Number: Number of grid levels.
    • Upper and Lower Price Limits: The price range within which the bot operates.
    • Leverage: The level of leverage you wish to apply.

    Here’s an example setup for different strategies:

    For a volatile market:

    • Investment Amount: $1000
    • Grid Number: 20
    • Upper Price Limit: $40,000
    • Lower Price Limit: $30,000
    • Leverage: 10x

    For a stable market:

    • Investment Amount: $500
    • Grid Number: 10
    • Upper Price Limit: $35,000
    • Lower Price Limit: $32,000
    • Leverage: 5x

    Once your parameters are set, click Create to activate the bot.

    The bot automatically places long and short positions within the specified price range, helping you maximize profits across varying market conditions.

    Using the Bybit Futures Grid Bot can provide more arbitrage opportunities, as the bot continuously places orders at high frequency, something virtually impossible for a human trader.

    This automated system enhances your trading strategy by making swift market decisions.

     

    Frequently Asked Questions

    For those new to Bybit futures trading, it is essential to understand the basics, such as starting strategies, fees, minimum investment requirements, and the steps to trade derivatives.

    How can beginners start trading futures on Bybit?

    Beginners should start by creating an account on Bybit. Once registered, familiarize yourself with multi-timeframe analysis and simple moving averages, essential for recognizing market trends. Use Bybit’s educational resources and demo accounts to practice and build confidence.

    What are the fees associated with Bybit futures trading?

    Bybit charges a maker fee of -0.025% and a taker fee of 0.075%. Other costs, such as funding rates and withdrawal fees, may apply. Reviewing Bybit’s fee structure on its official website is crucial to understand all potential costs involved.

    Can you initiate trades on Bybit with a minimum of $1?

    Yes, Bybit allows you to start trading with as little as $1. This makes it accessible for those who want to begin trading with minimal financial risk. However, ensuring you have enough margin for the leverage you intend to use is essential to avoid liquidation.

    What steps are involved in trading derivatives on Bybit?

    First, deposit funds into your Bybit account. Next, select the desired futures contract and set up your trade using the order form. Monitor your position closely and adjust your strategy as needed. Use limit, market, or conditional orders to manage your trades effectively, and consider using stop-loss orders to manage risk.

    Conclusion

    Embarking on your Bybit futures trading journey opens up a world of possibilities.

    You can enhance your trading decisions by utilizing strategies like multi-time frame analysis and leveraging tools such as the 200-period simple moving average.

    Begin by creating your Bybit account and making your first deposit. Depositlatform provides a user-friendly interface to help streamline the process.

    To support your growth, consider exploring these resources:

    Joining a community of traders can offer additional insights. Don’t hesitate to engage in forums and signal groups to stay updated on market trends.

    By staying informed and practicing consistently, you can effectively develop your future trading skills on Bybit.

    Browse Other Useful Guides

    About the Authors

    Hi, I'm Charles Johns, a Finance graduate with a specialization in Financial Management from the University of Chicago. My journey through financial markets has fueled a passion for both traditional and digital assets, where I continuously explore evolving investment opportunities. As an active trader and cryptocurrency enthusiast, I strive to bridge the gap between complex financial concepts and practical, real-world applications. My goal is to empower everyone, whether seasoned investors or newcomers, with valuable insights and knowledge to confidently navigate the world of finance and crypto investing.