Understanding funding rates

Perpetual futures never expire, so exchanges need a way to keep the contract price close to the underlying spot price. That mechanism is the funding rate — a small payment exchanged directly between long and short holders at regular intervals.

Who pays whom

When funding is positive, longs pay shorts — typically a sign that traders are crowded into long positions and willing to pay to hold them. When funding is negative, shorts pay longs. Persistent, extreme funding in either direction is a sign of one-sided positioning that can unwind sharply.

Why we annualize

Funding settles every 8 hours on most venues, but some use 4 hours, so the raw numbers aren't directly comparable. Quantority annualizes each rate and takes an open-interest-weighted average across Binance, Bybit, OKX and Bitget, giving one cross-exchange figure (APR). See the methodology for the exact formula.

Reading the 90-day percentile

A single funding number lacks context — is 12% APR high for this coin? The 90-day percentile answers that: it shows where current funding sits within the coin's own last 90 days. A reading near 100 means funding is unusually elevated; near 0 means unusually negative. Check it on any coin's funding page.