How Hyperliquid Perpetual Funding Rates Are Calculated and Paid
Summary
The document explains funding payments for Hyperliquid crypto perpetual contracts, which transfer value between longs and shorts to help keep contract prices aligned with spot. The payment direction depends on the premium of the contract relative to an oracle price: a premium generally makes longs pay shorts, while a discount reverses the transfer. Payments occur hourly, and the rate combines an averaged premium measure with a fixed interest component subject to a bounded adjustment.
It describes how the premium is derived from impact prices and oracle prices, notes a separate formula for HIP-3 contracts, and states that payment notional uses the oracle price. A numerical example illustrates the calculation for a long position when the contract trades at a premium. Funding can affect the cost of holding a perpetual position and may encourage trades against large price dislocations, but it is not a guaranteed convergence mechanism. Rates, caps, and formulas are specific to the venue and may change.
Key ideas
- Funding is a peer-to-peer transfer between perpetual contract holders intended to limit divergence from spot.
- A positive contract premium generally means longs pay shorts, while a negative premium generally means shorts pay longs.
- The hourly rate is based on an averaged premium and an interest-rate adjustment with a stated clamp.
- Funding payments use position size and oracle price to determine notional value.
- Hyperliquid’s formulas and caps are venue-specific and should not be assumed to apply to other exchanges.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.