Crypto glossary
Spot market
A spot market is a market where crypto is bought and sold for immediate delivery at the current price, as opposed to derivatives that settle later.
On a spot market the trade settles right away: the buyer receives the coins and the seller receives payment at the price agreed at that moment, known as the spot price. Buying bitcoin on an exchange and withdrawing it to a wallet is a spot trade.
Most everyday crypto trading on centralized exchanges and DEXs happens on spot markets, although derivatives volumes are often larger. The spot price is the reference for futures, perpetual contracts and options, which use index prices built from several spot venues. The label also appears in spot bitcoin ETFs, approved in the US in January 2024, which hold actual bitcoin rather than futures.
Spot trading without borrowing is the most direct form of exposure: losses are limited to the money invested and there is no liquidation. Coins left on an exchange after a spot purchase still depend on that platform's solvency, which is why many buyers move them to self-custody.
Example
A user buys 0.05 BTC on the BTC/USDC spot market at 60,000 dollars, pays 3,000 USDC and can withdraw the bitcoin to a personal wallet minutes later.
Related terms
Latest articles on Spot market
- Rakuten Wallet Expands Spot Market With Five New Listings Including XRP
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- Bybit to List EDGE on Spot Market
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