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Perpetual futures never expire, so they need another way to stay close to the real price of the asset. That mechanism is funding: a regular payment exchanged directly between long and short traders.

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How funding works

  • When the perp price trades above the spot price, the funding rate is positive. Longs pay shorts. This makes holding longs more expensive and pulls the perp price down.
  • When the perp price trades below the spot price, the funding rate is negative. Shorts pay longs.
Funding is paid between traders. DYXY does not receive any part of it.

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How much you pay or receive

Funding payment = position size × funding rate Example. You hold a $10,000 long on ETH. The funding rate is +0.01%. At the funding time, you pay $1 to shorts. If you held a short of the same size, you would receive $1. You only pay or receive funding if you hold the position at the moment funding is settled. Opening and closing between two funding times means no funding at all.

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Where to see funding

The market bar shows the current funding rate and a countdown to the next payment. Funding is settled at regular intervals that depend on the market, and the interval is shown next to the rate. Your past payments are listed under Funding history in V2.

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Funding and your strategy

An extremely high positive or negative funding rate shows that one side of the market is crowded. It is worth knowing before you join that side.