Derivatives and Perpetuals·Lesson 22 of 31·24 min
Funding Rates and Arbitrage
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The concept Because perpetual futures never expire, there's no settlement date naturally forcing their price to converge with spot. The funding rate fills that gap: at fixed intervals (commonly every 1 or 8 hours), the protocol calculates the gap between the perp's price and the underlying spot/index price, and one side of the trade (longs or shorts, whichever is pushing……
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