Cryptocurrency Funding Rates Show Cautious Optimism

According to BlockBeats, the funding rates on major centralized and decentralized exchanges have slightly increased, indicating a cautious bullish sentiment in the market. Funding rates are a mechanism used by cryptocurrency trading platforms to maintain the balance between contract prices and the prices of underlying assets, typically applied to perpetual contracts. This system facilitates the exchange of funds between long and short traders, without the platform charging a fee, to adjust the cost or profit of holding contracts and keep contract prices aligned with asset prices. A funding rate of 0.01% is considered the baseline. When the rate exceeds 0.01%, it suggests a general market optimism. Conversely, a rate below 0.005% indicates a bearish market sentiment.