Funding rates, live.
Every few hours, traders on the crowded side of a perpetual pay the other side a small fee — that's funding. Live across BTC, ETH, SOL and 20+ pairs, with annualized rates and long/short bias. Never traded futures? The plain-English guide is right under the rates.
Never traded futures? What a funding rate actually is.
A funding rate is a small fee traders pay each other every few hours to keep a "perpetual" price honest. You never pay it to the exchange — you pay it to, or collect it from, the traders betting the opposite way. Here's the whole idea from zero. No experience needed.
First, 4 words
- Spot price
- The real, current price of the coin — what you'd pay to buy 1 actual Bitcoin right now.
- Perpetual ("perp")
- A contract that lets you bet on a coin's price without owning the coin, and that never expires. A normal futures contract has an end date; a perp doesn't — which is exactly why funding rates have to exist.
- Long
- A bet that the price will go up.
- Short
- A bet that the price will go down.
Why funding rates exist (the seesaw)
A perpetual never expires and you never receive an actual coin — so nothing automatically forces its price to match the real (spot) price. If far more people are betting long than short, that buying pressure pushes the perp's price above spot, and it could drift away from reality.
Funding rates are the fix. Picture a seesaw: longs on one side, shorts on the other. Every 8 hours, whichever side is heavier (more crowded) pays a small fee to the lighter side. Having to pay to stay on the crowded side makes it less attractive, which nudges the perp's price back toward spot. So:
- Positive rate → longs are crowded → longs pay shorts. The market is leaning bullish.
- Negative rate → shorts are crowded → shorts pay longs. The market is leaning bearish.
So the number is two things at once: a small recurring cost (or income) of holding your position, and a quick read on which way the crowd is leaning.
A worked example with real numbers
Say you go long $1,000 of BTC on a perp, and the funding rate is +0.01% (a very ordinary number), charged every 8 hours:
- Each payment: $1,000 × 0.01% = $0.10, paid to the shorts.
- Over a full day (3 payments): about $0.30.
- Held for a year (3 × 365 = 1,095 payments): about $110, or ~11% a year — that's the "annualized" figure shown on this page.
Two things to notice: per payment it's tiny, but it adds up the longer you hold; and you only pay if you're holding at the funding moment (e.g. 00:00 / 08:00 / 16:00 UTC on Binance). Open and close in between, and you pay nothing.
The one line to remember: funding is the rent you pay — or collect — for keeping a perpetual position open. Positive = longs pay shorts; negative = shorts pay longs. Tiny each time, but it compounds the longer you hold.
⚠ Why it matters to you: on a leveraged long held for days, positive funding quietly eats your profit even if the price goes your way — so check the rate before holding overnight. And a very high rate is a crowding warning: when almost everyone is long and paying to stay long, the trade is lopsided and prone to sharp reversals. Plenty of traders watch funding less to earn it and more to spot an over-crowded market.
Common questions
What are crypto funding rates?
Funding rates are small, periodic payments exchanged directly between long and short traders on perpetual futures — not a fee paid to the exchange. They exist to keep the perpetual's price anchored to the real (spot) price. When the rate is positive, longs pay shorts; when it's negative, shorts pay longs.
Do I pay the funding rate to the exchange?
No. Funding is paid between traders — from the crowded side of the trade to the other side. The exchange only calculates the rate and moves the money; it doesn't keep it. (Trading fees and the spread are separate, and those do go to the exchange.)
Do I always pay funding if I hold a position?
Only if you're holding at the exact funding timestamp. On most exchanges like Binance that's every 8 hours — 00:00, 08:00 and 16:00 UTC. If you open and close your position between those times, you pay and receive nothing. Hold across the timestamp and you pay (or collect) one funding payment.
What does a high positive funding rate mean?
A high positive rate means lots of traders are long and the perpetual is trading above spot, so longs pay shorts. It signals bullish, crowded sentiment — which is also why an unusually high rate can precede sharp pullbacks, since the long side is lopsided and expensive to hold.
What does a negative funding rate mean?
A negative rate means short traders are paying long traders — usually because more traders are short and the perpetual is trading below spot. It signals bearish sentiment, and it means longs actually get paid to hold the position.
How do funding rates affect my trading strategy?
Funding is a recurring cost (or income) of holding a perpetual position. High positive rates slowly erode a long's profit the longer it's held; negative rates pay longs to wait. Some traders run funding arbitrage — long the spot coin and short the perp — to collect positive funding while staying market-neutral. Most beginners just check the rate before holding overnight.
What is the annualized funding rate?
It extrapolates the current 8-hour rate across a whole year (rate x 3 x 365) so you can compare it to a yearly interest rate. A 0.01% 8-hour rate annualizes to roughly 11% a year. It's an estimate only — funding changes every interval — but it makes the real cost of holding a position easy to grasp.
Are funding rates the same on every exchange?
No. Each exchange sets its own rate from its own order book, so BTC funding on Binance, Bybit and OKX can differ at the same moment. That's why this page shows rates side by side — the gaps are what funding-arbitrage traders watch.