Funding Rate
The funding rate of perpetual futures. Shows who is paying to hold a position — longs or shorts.
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Extreme skew towards longs, risk of a cascade
What the metric shows
Funding Rate is a mechanism that keeps the price of a perpetual futures contract close to the spot price. When the rate is positive, longs pay shorts: the market is overheated on the buy side. When it is negative, it's the opposite.
A consistently high positive funding rate over several days often precedes a cascade of long liquidations. This is a fast metric — unlike MVRV, it works on a horizon of hours and days.
How it is calculated
Funding = Premium Index + clamp(Interest Rate − Premium Index, ±0.05%)
Payout every 8 hours
How to read the signal
| Zone | Value | Interpretation |
|---|---|---|
| > +0.05% | Extreme skew towards longs, risk of a cascade | |
| −0.01% … +0.03% | Normal range | |
| < −0.02% | Shorts are paying — often a local bottom |
Frequently Asked Questions
Why are the values different across exchanges?
Each exchange calculates its own premium index based on its own basket of prices — this is what arbitrage is built upon.
Can I set alerts?
Yes — on the crossing of a specified rate level, in Telegram (planned).