Funding rates are one of the most reliable real-time signals of market positioning — and most traders treat them as background noise. This episode covers the structural problem they solve, what they actually cost you in practice, how to read them as a market signal, and how LeverUp's funding rate mechanism is structured.

The mechanism: perpetuals have no expiry date, so funding rates are the correction mechanism that keeps perp prices anchored to spot. When longs dominate, longs pay shorts; when shorts dominate, shorts pay longs. The rate scales dynamically with the imbalance. The cost section covers three underappreciated facts: rates change during the life of a trade, duration multiplies cost (a two-week hold at elevated rates can exceed entry and exit fees combined), and on LeverUp, holding fees and funding fees are consolidated into a s ...