What is funding on a perpetual contract?
A recurring payment between the two sides that keeps the contract tracking the real price.
A perpetual contract never expires, so something has to keep it anchored to the underlying price. That something is funding: at regular intervals, one side pays the other.
When the contract trades above the spot price, holders of long positions pay holders of short ones, which discourages the crowd from piling further onto that side. When it trades below, the payment reverses.
Two practical points. Funding is charged on the whole position, not on your margin, so at high leverage it eats a meaningful share of the collateral over time. And the interval is not the same everywhere — eight hours is common but not universal, and some venues charge hourly.
Persistently high funding on one side is not a prediction, but it is a fact about the fuel available: a crowd on one side is a crowd of forced sellers if the price turns.
Perpetual futures and funding has the numbers.
Last checked 19 Oct 2026.