What Is Funding Rate and How Do You Earn Every 8 Hours

What Is a Funding Rate?

A funding rate is a periodic fee exchanged between long (buy) and short (sell) positions in perpetual futures markets. Unlike traditional futures that expire on a date, perpetual futures never expire — so exchanges use funding rates to keep perpetual futures prices anchored to spot prices.

💡 When futures price is above spot price — funding rate is positive. Longs pay shorts. You earn as a short. When futures price is below spot price — funding rate is negative. Shorts pay longs. You would pay instead of earn. This is why we only signal when rates are positive.

When Does Funding Settle?

Most exchanges including Market X settle funding every 8 hours. The three daily settlement times are:

Settlement	Time (UTC)	What Happens
Settlement 1	00:00 UTC	Longs pay shorts (when positive)
Settlement 2	08:00 UTC	Longs pay shorts (when positive)
Settlement 3	16:00 UTC	Longs pay shorts (when positive)

Three times per day, every day, automatically. You do not need to do anything — the payment goes directly into your futures wallet.

How Much Do You Earn Per Settlement?

Calculation Formula

Your Earnings = Futures Position Size × Funding Rate

Example: $500 futures position × 0.08% = $0.40 per settlement

Per day (× 3): $1.20

Per month (× 30 days): $36.00

That is 7.2% per month on your $500 futures position — with zero risk.

When Are Funding Rates High?

Funding rates are highest during strong bull markets when many retail traders are aggressively buying futures. They are lowest during sideways or bear markets. Our bot monitors rates every 10 minutes and only posts signals when rates exceed 0.05% per 8h — equivalent to over 54% APY.

Funding Rate/8h	Daily Yield	Monthly Yield	Annual APY	Signal?
< 0.01%	< 0.03%	< 0.9%	< 11%	❌ Close signal
0.01% – 0.05%	0.03–0.15%	0.9–4.5%	11–54%	⏳ Monitoring
0.05% – 0.10%	0.15–0.30%	4.5–9%	54–108%	✅ Open signal
0.10% – 0.15%	0.30–0.45%	9–13.5%	108–162%	✅ Strong signal
> 0.15%	> 0.45%	> 13.5%	> 162%	🔥 Peak signal

What Happens When Funding Goes Negative?

If the market turns bearish and futures price drops below spot, the funding rate turns negative. In this scenario, shorts pay longs — meaning you would owe money instead of earning it. This is exactly why Panther Core posts a CLOSE signal when rates approach zero or turn negative. Always wait for our close signal before exiting.

Ready to Start Earning?