What Is the Funding Rate on Perpetual Futures

Short answer

The funding rate is a periodic payment between long and short traders that keeps a perpetual futures price close to spot. When it is positive, longs pay shorts; when negative, shorts pay longs. It is charged on position notional. BTCUSDT settles every 8 hours and was at +0.0060% per interval (BTCUSDT, 2026-10-24). Most other Binance perps settle every 4 hours.

Last checked 2026-10-24

Key facts

Who pays	Positive rate: longs pay shorts. Negative: shorts pay longs
Typical interval	Every 8 hours on BTCUSDT and ETHUSDT; most other Binance USDⓈ-M perps settle every 4 hours, a few hourly
Charged on	Position notional value, not margin
BTCUSDT now (BTCUSDT, 2026-10-24)	+0.0060% per interval
Cost on 10,000 USDT	+0.60 USDT per interval, about +1.80 per day

Why do perpetual futures need a funding rate?

A perpetual contract never expires, so nothing forces its price back to the spot price the way a delivery date does. The funding payment does that job. When the contract trades above the index, longs pay shorts. That makes holding a long more expensive and pulls the price down toward spot. The opposite happens when it trades below.

The exchange is not a party to the payment. It only calculates the rate and moves the money between traders who hold positions at the funding timestamp.

How do I calculate my funding cost?

Funding = position notional × funding rate. Notional is the full position size (price × quantity), not the margin you posted. Binance uses the mark price for this, not your entry price.

Worked example with the live rate: a 10,000 USDT long on BTCUSDT at +0.0060% pays +0.60 USDT at the next funding time. BTCUSDT settles every 8 hours. If the rate stayed the same, three payments a day add up to about +1.80 USDT. With 10x leverage that position needs only about 1,000 USDT of margin, so funding becomes ten times larger relative to your capital.

Contracts on a 4 hour interval settle more often. The same rate per interval costs more per day on those contracts, so check the interval before you compare.

What do extreme funding rates tell you?

Very high positive funding means longs are paying a lot to keep their positions open. That can point to a crowded long trade. Deeply negative funding can point to the same on the short side. The rate alone does not tell you whether or when those positions will unwind.

Extreme rates are quoted per funding interval, and most altcoins settle every 4 hours, some hourly. A rate on a 4 hour contract is not directly comparable to the same rate on an 8 hour contract like BTCUSDT.

Funding describes positioning, not future direction. Use it as context next to open interest and price, not as a signal on its own.

When is funding paid, and can I avoid it?

You pay or receive funding only if you hold a position at the exact funding timestamp. Closing before the timestamp avoids that payment, but trading fees and spread can cost more than the funding you save. Intervals differ between contracts, so check the countdown shown next to each contract on the exchange.

FAQ

Is the funding rate a fee paid to the exchange?

No. It is exchanged between traders holding long and short positions. The exchange only calculates it.

How often is funding paid?

It depends on the contract. BTCUSDT and ETHUSDT settle every 8 hours. Most other Binance USDⓈ-M perpetuals settle every 4 hours, and a few hourly. Check the countdown on each contract.

Do I pay funding on spot trades?

No. Funding applies only to perpetual futures positions.

Does leverage change the funding I pay?

Funding is charged on notional. Higher leverage lets a small margin carry a large notional, so funding is larger relative to your capital.

Can funding change every interval?

Yes. It is recalculated from the premium between the contract and the index, so it can flip sign between intervals.

Sources

Figures change. Check the primary sources below.