MetenaFunding rate: definition and bitcoin history
A periodic payment between buyers and sellers on perpetual contracts. Strongly positive, it indicates leveraged buyers dominate and the market is stretched.
Definition
A perpetual contract has no expiry date. To keep its price close to the spot market, buyers and sellers exchange a payment every 8 hours: the funding.
When the perpetual trades above spot, funding is positive and buyers pay sellers. Very positive funding shows many leveraged buyers willing to pay a lot to keep their position: the market is stretched. Negative funding shows the opposite.
How to read the chart
The curve shows each day’s funding, scaled to an annual rate and smoothed over 7 days. In green, buyers pay; in red, sellers pay.
The big green spikes match phases of euphoria; the red dips, panics.
Worked example
Since September 2019, funding on Binance’s BTCUSDT perpetual has been positive on 87% of days. Its 7-day average peaked at 140% a year on 14 February 2021 and touched −52% a year on 19 March 2020, a week after the crash. On 7 October 2026, it is close to 3% a year.
In Metena
Funding is available as a condition in a Metena strategy, and the stress test includes a persistent negative funding scenario for strategies that depend on it.
Notify me at launchRelated terms
- Open interest
- The total value of derivative contracts still open. Record open interest signals a lot of leverage in the market, so sudden moves are more likely.
- Leverage
- Borrowing to take a position larger than your capital. It amplifies gains and losses alike and can lead to the position being liquidated.
- Fear & Greed
- A sentiment index from 0 (extreme fear) to 100 (extreme greed) that combines several measures of market behavior.
- Volatility
- The size of an asset’s price swings. High volatility means large moves, up as well as down.
Put these ideas into practice.
Write your strategy in a few minutes: Metena analyses it when you ask and explains each term in context.
Notify me at launchEducational content. It is not investment advice. Crypto-assets carry a high risk that can go as far as the total loss of capital.