🧠 Today on INIT, someone who opens a $1,000 short pays about $12.40 in a single funding payment. Why?
📘 What it is: perpetual futures have no expiry date. To keep their price from drifting away from the spot price, longs and shorts pay each other periodically. That payment is the funding rate.
• Positive funding → longs pay shorts (more people are betting on prices going up)
• Negative funding → shorts pay longs (more people are betting on prices going down)
📊 Example using today's data (Binance):
• $BTC : +0.0089% → a $1,000 long pays about $0.09 per payment. Normal and uneventful.
• $INIT : −1.24% → a $1,000 short pays $12.40 per payment, about 140 times what a long pays on BTC.
❌ Common mistake: thinking “negative funding = the price is going down.” If lots of shorts are paying a hefty amount and the price rises, they may be forced to close their positions, pushing the price even higher (a short squeeze). Funding measures how people are positioned, not where the price is headed.
✅ In a nutshell: funding tells you who is betting on what… and how much it costs them to keep that bet open.
Do you check funding before opening a futures position? YES or NO 👇
#FundingRate #Futuros #AprendeCripto #Cripto #Tra100d
⚠️ For informational and educational purposes only; this is not financial advice. Cryptocurrencies are volatile: do your own research and trade with caution.
📘 What it is: perpetual futures have no expiry date. To keep their price from drifting away from the spot price, longs and shorts pay each other periodically. That payment is the funding rate.
• Positive funding → longs pay shorts (more people are betting on prices going up)
• Negative funding → shorts pay longs (more people are betting on prices going down)
📊 Example using today's data (Binance):
• $BTC : +0.0089% → a $1,000 long pays about $0.09 per payment. Normal and uneventful.
• $INIT : −1.24% → a $1,000 short pays $12.40 per payment, about 140 times what a long pays on BTC.
❌ Common mistake: thinking “negative funding = the price is going down.” If lots of shorts are paying a hefty amount and the price rises, they may be forced to close their positions, pushing the price even higher (a short squeeze). Funding measures how people are positioned, not where the price is headed.
✅ In a nutshell: funding tells you who is betting on what… and how much it costs them to keep that bet open.
Do you check funding before opening a futures position? YES or NO 👇
#FundingRate #Futuros #AprendeCripto #Cripto #Tra100d
⚠️ For informational and educational purposes only; this is not financial advice. Cryptocurrencies are volatile: do your own research and trade with caution.