Perpetual Funding Rates, Explained
Funding is a periodic payment between long and short positions designed to help keep a perpetual contract close to its reference market.
Key idea
Funding tells you about positioning pressure and carrying cost. It does not tell you what price must do next.
In this guide
Related workflow
Perpetuals →Read the sign and interval
Positive funding generally means longs pay shorts; negative funding reverses that relationship. The rate is only meaningful together with how often it is charged.
Pair it with positioning
Open interest, price and volume help explain whether expensive funding reflects crowded positioning, active trend participation or a temporary imbalance.
Treat it as a cost
For an open position, funding can add to or subtract from P&L over time. Include that carrying cost when evaluating leveraged exposure.
Put it in context
Tools connected to this topic
Use the concepts above to understand what these tools show or ask you to approve.
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