How does crypto trading and market structure work?
A crypto market is an order book where buyers and sellers post prices, and the structure around it determines what a trade actually costs you. Spot trading exchanges one asset for another immediately, while futures and perpetual contracts trade an agreement about a price rather than the asset itself. Borrowing to trade a larger position is called margin, and if the position moves far enough against the borrowed amount the exchange closes it automatically, which is a liquidation.
The terms below explain who is on the other side of a trade, why the price you see is not always the price you get, and how leveraged positions can be forced to close in sequence during a sharp move. CryptoBipto teaches these mechanics and provides a paper-trading simulator with no real money involved. It does not execute trades and does not advise on them.
Trading and market structure terms explained
27 definitions, each with a plain-English version, a technical version, a worked example and the mistakes beginners make.
- Bid-Ask Spread
- Cross Margin
- Dark Pool
- Depth of Market
- Flash Crash
- Funding Rate
- Futures Market
- Initial Margin
- Isolated Margin
- Leverage
- Leverage Cascade
- Liquidation
- Liquidity Provider
- Long
- Maintenance Margin
- Margin
- Market Maker
- Market Taker
- Open Interest
- Order Flow
- Paper Trading
- Perpetual Futures
- Settlement
- Short
- Slippage
- Spot Market
- Squeeze
Where this is taught
This subject sits in the Advanced path of the CryptoBipto curriculum, which runs from complete beginner to expert across four tiers. You can browse the full curriculum or read free sample lessons before signing up.
Common questions
What is the difference between spot and futures trading?
Spot trading exchanges the asset itself, and once settled you hold it. Futures trade a contract about a future price, so you can hold a position without holding the asset, and you can lose more than your initial deposit if the position is leveraged.
What causes a liquidation?
A leveraged position is backed by collateral called margin. When the position's loss brings that collateral below the maintenance level, the exchange closes the position automatically to avoid a negative balance. The larger the leverage, the smaller the price move required.
Why did my trade execute at a worse price than I expected?
That difference is slippage, and it comes from market depth. A market order takes whatever prices are available until it is filled, so a large order in a thin book fills progressively worse. A limit order avoids that by refusing to fill beyond a price you set.
Related subjects
Educational only — not financial advice. CryptoBipto does not custody funds or execute trades.