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Perpetual Futures Funding Rates and Open Interest: A Practical Guide

A clear, data-driven guide to perpetual futures funding rates and open interest.

Perps without expiry

BitMEX introduced the perpetual swap in May 2016. A perp never expires; instead, funding payments push its price toward spot. When perps trade above the index, longs pay shorts; below, shorts pay longs.

The formula

Most exchanges compute funding every 8 hours as premium index plus a clamped interest component, typically 0.01 percent per 8 hours by default. That baseline equals about 10.95 percent annualized (0.01% × 3 × 365).

Open interest

Open interest is the total notional of outstanding contracts. Rising OI with rising price signals new longs; rising OI with flat price may indicate hedged basis trades. OI relative to market cap shows how leveraged an asset is.

Reading extremes

Funding above 0.05 percent per 8 hours, about 55 percent annualized, appeared in March 2024 and November 2024. Such crowded longs often precede liquidation cascades, while deeply negative funding can fuel short squeezes.

Carry example

Holding $10,000 short perp against spot at 0.01 percent per 8 hours collects $3 per day, about $90 per month, before fees and borrowing costs.

By the numbers

For Perpetual Futures Funding Rates and Open Interest, the reference figures are topic of Perpetual Futures Funding Rates and Open Interest, level of Intermediate, updated of 2026. The comparison table below lines up 8h funding, annualized, signal — 0.01%: ~10.95% / Neutral baseline; 0.03%: ~32.9% / Bullish crowding; 0.05%: ~54.8% / Overheated; -0.02%: ~-21.9% / Short crowding.

Modeling Perpetual Futures Funding Rates and Open Interest with the Perpetual Funding Rate Carry Calculator

The Perpetual Funding Rate Carry Calculator takes three inputs — Notional ($), Funding per 8h (%), Days. Carry = notional × rate × 3 × days. With its default inputs (Notional ($) = 10000; Funding per 8h (%) = 0.01; Days = 30) it returns 90 $; swap in the figures from Perpetual Futures Funding Rates and Open Interest above to reproduce the scenario yourself.

Modeling Perpetual Futures Funding Rates and Open Interest with the Open Interest To MCAP Analyzer

The Open Interest To MCAP Analyzer takes three inputs — Open interest ($B), Market cap ($B), Price ($). OI/MC = open interest ÷ market cap. With its default inputs (Open interest ($B) = 30; Market cap ($B) = 1300; Price ($) = 65000) it returns 2.31 %; swap in the figures from Perpetual Futures Funding Rates and Open Interest above to reproduce the scenario yourself.

Data Table

For educational and informational purposes only. Not financial, investment, tax or legal advice. Figures are approximate and historical; crypto assets are volatile and you may lose capital. Do your own research.