TLDR
Funding rates rose modestly across majors last week.
- Bitcoin (BTC): funding rate increased about 3.7 percentage points to 8.9% per a derivatives update from 10x Research cited in a market report.
- Ethereum (ETH): funding rate increased about 3.4 points to 6.9% (same report as above).
- After options expiry, Deribits perpetual funding briefly surged above 30%, indicating crowded long positioning per a market note.
Deep Dive
1. Weekly Drift (BTC, ETH)
Funding rates, the periodic fee between longs and shorts in perpetual futures to tether price to spot, ticked higher week over week for BTC and ETH. The BTC rate rose ~3.7 points to 8.9%, while ETH rose ~3.4 points to 6.9%, with futures open interest down by roughly $500 million to $27.3 billion (see the report above). Modest rate rises alongside lighter open interest suggest positioning is biased long but not excessively levered.
Higher positive funding implies longs are paying shorts to hold leverage. If price stalls, those carrying costs can accelerate long unwinds.
2. Post?Expiry Spikes
Into and after the recent options expiry, some venues saw sharp, temporary funding spikes. Deribits perpetual funding jumped above 30%, a level consistent with crowded long positioning and short?term heat rather than durable trend strength (the report above). Other coverage noted muted funding and range trading outside such bursts.
Spikes often mark local crowding. If price fails to push higher quickly, high carry can flip from tailwind to vulnerability.
3. Settlement Frequency Changes
Binance announced a change to funding payment frequency for USD??M perpetuals when funding stays at or below an absolute 0.025% for 16 consecutive cyclesshifting from hourly to every four hours (00:00, 04:00, 08:00, 12:00, 16:00, 20:00 UTC), with reversion if the rate moves above the threshold, per an exchange notice.
Prolonged near?zero funding reduces how often payments net out. Operationally, it smooths settlements when basis is flat, but the cost re?intensifies if funding lifts again.
Conclusion
Funding rates rose modestly across BTC and ETH last week, with isolated spikes around expiry indicating crowded longs. The core takeaway is positioning bias rather than extreme leverage. If momentum fades, positive funding can become a drag on long carry; if price breaks higher, it can reflect sustained demand. Monitoring venue?level funding and open interest helps distinguish durable trend from short?term heat.
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