> For the complete documentation index, see [llms.txt](https://blackboard-fi.gitbook.io/blackboard-docs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://blackboard-fi.gitbook.io/blackboard-docs/trade/funding-rates.md).

# Funding Rates

Funding rates are the core mechanism that keeps perpetual futures prices aligned with spot prices.

## How It Works

Since perpetual futures have no expiry, the funding rate adjusts the gap between the futures price and the spot price.

* **Positive funding rate**: Futures price > Spot price → Longs pay shorts
* **Negative funding rate**: Futures price < Spot price → Shorts pay longs

This creates an incentive for the perpetual futures price to converge with spot.

## Settlement Schedule

| Market                                             | Settlement Interval                                                |
| -------------------------------------------------- | ------------------------------------------------------------------ |
| Crypto perpetuals (Aster)                          | 8 hours by default; varies per market (check each market's screen) |
| Real-world asset perpetuals (HIP-3 on Hyperliquid) | Every 8 hours (00:00, 08:00, 16:00 UTC)                            |

## Calculation

```
Funding Payment/Receipt = Position Size × Funding Rate
```

**Example**: BTC-PERP long position of $10,000, funding rate 0.01%

* Payment at settlement: $10,000 × 0.01% = **$1.00** (paid by longs to shorts)

## Checking Funding Rates

* The current funding rate and time until next settlement are displayed at the top of the trading screen.
* Historical funding rate data is also available.

## Funding Rate Strategies

### Funding Rate Farming

Holding a short position in a persistently positive funding rate market earns funding rate income at each settlement.

* Once Agentic Trading launches (coming soon), you will be able to describe this strategy in natural language, backtest it, and run it automatically.
* Price movement risk can be hedged by buying spot.

### Cautions

* Funding rates can change rapidly based on market conditions.
* Funding costs can be substantial on large positions — be mindful when holding long-term.

## Next Steps

* [Liquidations](/blackboard-docs/trade/liquidations.md) — Liquidation mechanics
* [Fees](/blackboard-docs/resources/fees.md) — Full fee structure