What Funding Rates in Crypto Futures Really Mean

From financefeeds.com

Perpetual futures contracts dominate cryptocurrency derivatives trading because they never expire, allowing traders to maintain leveraged positions indefinitely. But this flexibility introduces a structural challenge: without an expiration date, there is no natural mechanism to force the futures price to converge with the spot market. That is where funding rates come in. Despite being one of the most critical mechanics in crypto derivatives, funding rates remain widely misunderstood. They are not exchange fees. They are not arbitrary. They are periodic payments exchanged directly between traders, and they serve as ... (full story)