To ensure that the price of perpetual contracts better reflects the changes in the underlying market, the exchange has established a funding fee mechanism. This mechanism facilitates a periodic cash flow exchange between long and short position holders, guiding the price of the perpetual contract to converge with the index price.

 

When the funding rate is positive, long position holders pay the funding fee to short position holders; conversely, when the funding rate is negative, short position holders pay the funding fee to long position holders. Please note that the BTCC platform only facilitates the funding fee exchange between long and short position holders, and does not charge any service fees.

 

In general, BTCC processes funding fees three times a day, at 8:00, 16:00, and 24:00 (UTC+8), every 8 hours. Each perpetual contract's fee is calculated at millisecond intervals and does not interrupt trading. Traders holding open positions are obligated to pay or receive funding fees after the funding fee calculation is completed. If you close your position before the funding fee calculation, you will not be required to pay or receive any funding fees. Additionally, if the perpetual contract goes offline before the funding fee calculation, the funding fee for that period will be voided and will not be charged. The actual funding fee calculation may last up to one minute. For example, if a trader opens a position at 00:00:20 (UTC+8) and the funding fee calculation has not been completed yet, the trader may still be required to pay or receive funding fees.

 

The timing of the funding fee payments and receipts may be adjusted in real-time based on market conditions.

 

Funding Rate Calculation

 

To provide more professional trading services and enhance your trading experience, BTCC will change the funding rate calculation formula for perpetual contracts in three phases. For more details, please refer to the official documentation.

 

The funding rate is calculated as follows:

Funding Rate=clamp[Average Premium Index+clamp(Interest Rate−Average Premium Index,0.05%,−0.05%),Funding Rate Cap,Funding Rate Floor]\text{Funding Rate} = \text{clamp} \left[ \text{Average Premium Index} + \text{clamp} \left( \text{Interest Rate} - \text{Average Premium Index}, 0.05\%, -0.05\% \right), \text{Funding Rate Cap}, \text{Funding Rate Floor} \right]Funding Rate=clamp[Average Premium Index+clamp(Interest Rate−Average Premium Index,0.05%,−0.05%),Funding Rate Cap,Funding Rate Floor]

• Interest Rate = 0.03% / (24 / Settlement Period)
  Example: For the BTCUSDT perpetual contract with a settlement period of 8 hours, the interest rate is 0.01%.
  
  
• Funding Rate Cap/Floor: For specific details, please refer to this page.
  
  
• Premium Index = max⁡(0,Depth Weighted Buy Price−Index Price)−max⁡(0,Index Price−Depth Weighted Sell Price)Index Price\frac{\max (0, \text{Depth Weighted Buy Price} - \text{Index Price}) - \max (0, \text{Index Price} - \text{Depth Weighted Sell Price})}{\text{Index Price}}Index Pricemax(0,Depth Weighted Buy Price−Index Price)−max(0,Index Price−Depth Weighted Sell Price)​
  
  
• The Average Premium Index is calculated using a weighted moving average, which takes the premium index of the past settlement period to the current one.
  Example: The average premium index at time TnT_nTn​ is calculated as:
  (1×Premium Index at T1)+(2×Premium Index at T2)+...+(n×Premium Index at Tn)1+2+...+n\frac{(1 \times \text{Premium Index at } T_1) + (2 \times \text{Premium Index at } T_2) + ... + (n \times \text{Premium Index at } T_n)}{1 + 2 + ... + n}1+2+...+n(1×Premium Index at T1​)+(2×Premium Index at T2​)+...+(n×Premium Index at Tn​)​
  Suppose a contract settles funding fees every 8 hours, the funding rate at 14:59 will be calculated using the premium index from 7:00 to 14:59, with n=480n = 480n=480.
  
  
• The Depth Weighted Buy (Sell) Price is the average price of the buy (sell) side based on the weighted trading depth.
  
  
  • Depth Weighted Buy (Sell) Price = Depth Weighted AmountAmount of Currency Needed to Satisfy the Depth Weighted Amount\frac{\text{Depth Weighted Amount}}{\text{Amount of Currency Needed to Satisfy the Depth Weighted Amount}}Amount of Currency Needed to Satisfy the Depth Weighted AmountDepth Weighted Amount​
    
    
  • Example: Depth Weighted Amount = 20,000.
    
    

The funding rate is calculated every minute, and the funding fee at the settlement time will be based on the funding rate at that time.
Example: At 16:00, the funding rate used for the funding fee calculation is the one calculated at 16:00.

 

BTCUSDT Perpetual Contract Depth Weighted Buy Price Calculation Example

 

Assume the Depth Weighted Amount = 20,000 USDT.

 

BTCUSDT Perpetual Contract Depth Weighted Sell Price Calculation Example

 

 

Funding Fee Calculation

 

Funding Fee = Position Value × Funding Rate

 

For USDT Margin Contracts:

Position Value = Number of Contracts × Contract Face Value × Contract Multiplier × Mark Price.

 

Example:
A user holds 10 BTCUSDT perpetual contracts in a long position. The current mark price is 60,000 USDT, and the contract face value is 0.01 BTC. The funding rate is 0.1%.

Position Value = 60,000 × 10 × 0.01 × 1 = 6,000 USDT
Funding Fee (charged by the platform) = 6,000 × 0.1% = 6 USDT