Futures
Agreement to buy/sell an asset at a set price in the future.
Traditional futures (CME, Binance Quarterly) have an expiry - e.g. BTC March 2025. Price may differ from spot (premium/discount). CME BTC futures are key for institutions - first regulated BTC market in US (2017). Basis trade: buy spot BTC, sell futures, earn the premium.
In plain words
A deal: in 3 months I'll buy BTC from you at 80k USD. If BTC is 100k in 3 months you make 20k.
Example
CME BTC March 2024: contract at 70k vs spot 67k = 4.5% annual premium, institutions ran basis trades at 20%/year.
Also known as: dated futures