Perpetual futures prices differ from spot prices depending on market sentiment. The futures market adjusts these price differences through the Funding Rate. When futures prices are high, longs pay shorts, and when low, shorts pay longs to balance spot and futures prices. By utilizing this structure, an investment strategy exists where one can purchase spot assets, take a short position in futures to hedge price fluctuations, and earn income through funding rates. We have compiled top tokens showing profit opportunities through real-time data with high funding rates. [Editor's Note]
Recently in the cryptocurrency market, some tokens like Status(SNT), JasmyCoin(JASMY), Hyperlane(HYPER) have been recording high funding yields, emerging as key targets for arbitrage strategies between futures and spot markets among investors.
As of August 3rd at 12:10, according to data analysis platform DataMaxiPlus, Status(SNT) showed the highest expected annual funding rate return. By holding an SNT futures long position on Gate.io and taking a spot margin short position on the same exchange or Bitget, approximately 10.34% annual return is possible, which translates to about $51,612 annually based on $10,000.
For JasmyCoin(JASMY), by taking a long position on dYdX futures market and a spot short position on Bybit, Gate.io, Binance, and Bitget, an annual funding rate return of 8.47% can be generated, calculating to approximately $42,268 annually.
Additionally, for Hyperlane(HYPER), by combining Bybit futures market with spot markets on Binance, Bitget, and Gate.io, an annual funding rate return of 7.60% is possible, estimated at around $37,930 annually.
This strategy is designed to hedge price volatility while holding assets in the futures market. Particularly, when funding rates consistently record negative values, the possibility of realizing profits increases, and the strategy can be established within a relatively short period. However, an analysis of actual returns considering trading fees and margin interest is essential.
Current Highest and Lowest Funding Rate Tokens
High funding rates indicate strong long position demand in the market, while tokens recording negative funding rates suggest short position dominance.
๐ผ Top 5 Highest Funding Rates
โฒFragmetric(FRAG) - Bitget: 0.2034% (4-hour basis)
โฒZeus Network(ZEUS) - Bybit: 0.2213% (8-hour basis)
โฒZeus Network(ZEUS) - MEXC: 0.2213% (8-hour basis)
โฒAltura(ALU) - Bybit: 0.1201% (4-hour basis)
โฒAltura(ALU) - MEXC: 0.12% (4-hour basis)
๐ฝ Bottom 5 Lowest Funding Rates
โฒFragmetric(FRAG) - Bitget: -0.447% (4-hour basis)
โฒAltura(ALU) - MEXC: 0.0003%
โฒAltura(ALU) - Bybit: 0.0003%
โฒZeus Network(ZEUS) - MEXC: 0.0003%
โฒZeus Network(ZEUS) - Bybit: 0.0003%
When funding rates are high or positive, long position demand increases, making futures prices relatively more expensive than spot prices, requiring longs to pay funding fees to shorts. Investors can secure funding rate profits by implementing spot purchase and futures short-selling strategies.
Conversely, when funding rates are low or negative, high short position demand causes futures prices to be lower than spot prices, requiring shorts to pay funding fees to longs. Investors can maximize funding rate arbitrage by utilizing spot selling and futures long strategies.
Funding rate arbitrage is a strategy that can aim for stable returns regardless of market volatility, usable even when long-term market direction is difficult to predict. However, as funding rates are highly variable based on market participant position ratios, a strategic approach considering funding rate differences between exchanges and capital costs is necessary.
[This article does not provide financial advice, and investment outcomes are the sole responsibility of the investor.]
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