The funding fee mechanism anchors the market price of the perpetual contract to the spot price.
The funding fee is charged every 8 hours at 4:00 a.m. (UTC+8), 12:00 p.m. (UTC+8) and 20:00 p.m. (UTC+8) after the settlement of the contracts every day. Only when the positions are held at this time will the user need to pay or be charged with the funding fee. If the positions are closed before the fee is charged, there is no need to pay the funding fee.
1. Theoretical funding fees
Funding fee = Position value held * Funding rate. When the funding rate is positive, the long will pay the short; when the fund rate is negative, the short will pay the long.
Estimated funding rate = Clamp (MA ((Contract price for buying 1 + Contract price for selling 1) / 2 - Spot index price) / Spot index price - Interest), a, b)
*Interest is currently 0
* Perpetual contract: a and b are the upper limit and lower limit (tentatively + / - 0.0030), and MA represents the moving average.
The fund rate is calculated every minute. When collecting the funding fee, the funding rate calculated at 4:00 a.m.(UTC+8), 12:00 p.m. (UTC+8) and 20:00 p.m. (UTC+8) Singapore time will be used for the collection purpose.
Actual funding fee
When collecting the funding fee, it will be deducted from the user's position margin first. If the position margin balance is insufficient, it will be deducted to the extent that the user's margin rate is equal to the maintenance margin rate, and the excess part of the funding fee will be deducted from the available margin of the user's account.
The platform will not charge any funding fees; The funding fee will be charged by and between users.
Example:
Assuming a trader buys 10,000 lots of BTC contracts (long) for 10,000 at 8:11 a.m. Singapore time.
If:
1）The trader closes his positions at 10:20 a.m., he will not be charged or collected with funding fees.
2）The trader still holds the positions at 12:00 a.m., and the latest trading price of BTC is 10，024, the position value held = 10,000/10,024 =0.99760574 BTC. It is assumed that the funding rate at that time is 0.025%. In that case, the user will pay the funding fee of 0.00025 BTC = Position value * Funding rate (if the fund rate is negative, the short will make up the funding fee for the long)
Doex Team
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