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Funding Rate Tools
FUNDING ARBITRAGE OPPORTUNITIES
Loading...UNDERSTANDING FUNDING RATES
Funding rates are a mechanism that keeps perpetual contract prices aligned with the underlying spot price. Unlike traditional futures that expire on a specific date, perpetual contracts never expire — this creates a challenge where the perpetual price could drift far from the spot price indefinitely.
Longs pay shorts — bullish market sentiment (perp price > spot)
Shorts pay longs — bearish market sentiment (perp price < spot)
Funding rates are calculated locally, not globally. Each perpetual DEX has its own rate depending on traders, liquidity, positioning, formulas, and price action. This is exactly what creates arbitrage opportunities — you can exploit these differences to extract profit.
DELTA-NEUTRAL ARBITRAGE EXPLAINED
Delta-neutral arbitrage is a trading strategy that eliminates directional market risk while capturing funding rate differences between exchanges. You simultaneously open equal but opposite positions (long + short) on the same asset, making your portfolio neutral to price movements.
Worked Example: BTC Arbitrage
+0.005% / hour
You pay funding
+0.015% / hour
You receive funding
Regardless of whether BTC goes to $100k or $50k, your PnL remains neutral — you're paid the spread.