How to short crypto.
On a perpetual future you profit when price falls — no borrowing, no locating. The mechanics take a minute; the risk asymmetry is the part worth reading twice.
← All guides · September 2026
What shorting is
Going short means you profit when the price falls. On a perpetual future you do it directly — no borrowing, no locating shares, no separate margin product. You sell a contract you do not hold, and you close it by buying it back. If the price fell in between, the difference is yours.
This is the reason perps exist for most traders: a spot market only lets you express "up".
Placing a short
- Open the market in the terminal. The trade dock sits under the chart.
- Choose Sell / Short. That is the whole directional decision — the ticket is otherwise identical to a long.
- Set your size and leverage. The ticket shows the order value, the margin it will consume, and an estimated liquidation price before you submit.
- Attach a stop. On a short your stop sits above your entry. This is the step people skip, and it is the one that matters.
- Submit. Your position appears on the chart as a line, with its PnL on it.
Reading a short on the chart
A short inverts everything a long taught you, so the chart says so:
| Long | Short |
|---|
| Position line | Green | Red |
| Take profit | Green, above entry | Green, below entry |
| Stop loss | Red, below entry | Red, above entry |
The line is coloured by direction; the PnL printed on it is coloured by its own sign, so a short in profit shows a green number on a red line. The SL and TP boxes at the left of the position line can be dragged straight onto the chart, and the level refuses to be placed on the wrong side — you cannot accidentally set a short's stop below its entry.
What is different about being short
- The loss is not bounded. A long can fall to zero and no further. A short's loss grows with the price, and the price has no ceiling. This is the real asymmetry, and it is why a stop matters more here.
- Funding usually pays you — in a market where the perp trades above spot, shorts receive funding. In a falling market it can invert. On Hyperliquid in September 2026, longs paid shorts in 92.7% of market-hours (September's Hyperliquid funding report).
- Squeezes are violent. When a crowded short position is forced to buy back, it buys into its own stops. Sharp upward spikes on heavily-shorted markets are a feature of the instrument, not an anomaly.
Sizing a short you can survive
At 10× leverage a ~10% move against you removes the margin behind the position. Crypto does 10% on ordinary days. So the question is not "where do I think it goes" but "what move can I be wrong about and still be in the trade".
- Decide your stop before you size, then size so the stop costs an amount you are content to lose.
- Prefer isolated margin while learning — it caps what one trade can take.
- Remember fees ride on notional, not margin: 10× on $1,000 pays fees on $10,000.
Closing
Buy the contract back. In the dock, a position's row has Market and Limit close; on the chart, the position line carries an × to close it. A take-profit you attached does it for you if the level trades.
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