Cryptocurrency Market Shows Divergence in Funding Rates

According to BlockBeats, data from Coinglass indicates that the current funding rates on major centralized and decentralized exchanges (CEX and DEX) reveal a market characterized by both bearish and neutral sentiments. The specific funding rates for mainstream cryptocurrencies are detailed in the accompanying chart. Funding rates are fees set by cryptocurrency trading platforms to maintain a balance between contract prices and the prices of underlying assets, typically applied to perpetual contracts. This mechanism facilitates the exchange of funds between long and short traders, without the trading platform collecting these fees. It serves to adjust the cost or profit of holding contracts, ensuring that contract prices remain close to the prices of the underlying assets. A funding rate of 0.01% is considered the baseline rate. When the funding rate exceeds 0.01%, it indicates a generally bullish market sentiment. Conversely, a funding rate below 0.005% suggests a predominantly bearish market outlook.