Binance is making significant changes to its Futures platform, particularly for USD-M Perpetual Contracts. Starting on October 12, 2023, these contracts’ funding rate settlements will happen every four hours instead of every eight hours.
This change impacts various contracts like USD-M IMX, LPT, API3, and HIFI Perpetual Contracts. Funding rates ensure that contract prices align with the actual market value of the underlying asset, with positive rates resulting in payments between long and short position holders.
Additionally, as of October 9, 2023, capped funding rates for these contracts will have a new limit of ±3%, applying to contracts with a maximum leverage of 25x or lower. This change is designed to provide traders with more predictability and safety in volatile market conditions.
Funding rates can fluctuate based on market volatility. During periods of stability, rates tend to remain low, but during market turbulence, they can surge. The introduction of this new cap aims to offer traders a degree of predictability and safety, helping them navigate the sometimes unpredictable waters of the cryptocurrency market.
Image Credit: Shutterstock
Keep in mind that we may receive commissions when you click our links and make purchases. However, this does not impact our reviews and comparisons. We try our best to keep things fair and balanced, in order to help you make the best choice for you.
