JOJO.Exchange
  • JOJO EXCHANGE
    • 🔍Overview
    • 🚀Roadmap
    • 📣Announcement
      • 🛠️JOJO Exchange Upgrade to v2
      • 🤖Unlock Exclusive Rewards and AI-Powered Trading – The Future of DeFAI Awaits!
      • 🤝Transforming DeFi With Chainlink and Lido
      • 🪂JOJO's Airdrop Season 2!
      • 🎰Introducing Our New Mini-Game: Slot Machine!
      • 🪂Airdrop Season 1 claiming portal is ON!
      • 🤖JOJO is Integrating Chainlink Data Streams to Power Its Silicon-Based AI Exchange
      • 💡Upgrades to Chainlink Data Streams
      • 🪂JOJO's Airdrop Season 1!
      • 🍭You can now claim the reward for the 7-Day check-in Challenge!
      • ❗Notification of Environment Removal
      • 🪂JOJO's Airdrop Season 0!
      • 🪙New listing: WIF/USDC, ENA/USDC, CKB/USDC, BOME/USDC, W/USDC, ETHFI/USDC, ONDO/USDC, and DOGE/USDC
      • 🔖Fee Discount Notice
  • v2 product guides
    • 🧐Tutorials
      • How to Connect Wallet & login?
      • 💰Deposit & Withdraw
      • 📈How to trade Perpetual?
      • 📈How to Close a Position?
      • 📈What is a Limit Order, and how to place it?
      • 📈How to Place a TP/SL Order ?
      • 🕹️How to trade 1000X ?
    • 🤷FAQs
      • ❔How much leverage will be available on JOJO?
      • ❔Is there a deposit fee or withdraw fee on JOJO?
      • ❔What Happens When a Market Is Delisted
      • 📖How to Set Email
      • 📖What is PnL and How to Calculate It?
      • How to bridge assets to Base
      • 📖How to Swap USDC ?
  • 💵Fees
  • ⚖️Funding Rate
  • 💸Liquidation
  • 🔑API Keys
  • v1 Product guides
    • 🧐Tutorials
      • How to Connect Wallet & login?
      • 💰Deposit ,Transfer & Withdraw
      • 📈How to trade Perpetual?
      • 📈How to Close a Position?
      • 📈What is a Limit Order, and how to place it?
      • 📈How to Place a TP/SL Order ?
      • 👤How to use Sub Account?
      • 📈One-click Trade
      • 🕹️How to trade 1000X ?
      • 💰How to get JOJO airdrops?
      • 💰How to stake JOJO and get veJOJO?
    • 🤷FAQs
      • ❔Will there be more trading pairs in the future?
      • ❔What collateral does JOJO accept?
      • ❔How much leverage will be available on JOJO?
      • ❔What is One-click Trade and How does It Work?
      • ❔Is there a deposit fee or withdraw fee on JOJO?
      • ❔Why Trading on JOJO is Safe?
      • ❔Why do I keep receiving risk warning emails from JOJO?
      • ❔What Happens When a Market Is Delisted
      • 📖How to Set Email Notifications
      • 📖What is PnL and How to Calculate It?
      • How to bridge assets to Base
      • 📖How to Swap USDC ?
    • 🤖Ai Revolution
    • 📖Glossory
    • ✨Trading Pairs
    • 💵Fees
    • 🤑Prices
    • ⚖️Funding Rate
    • 💸Liquidation
    • 🤖Grid Bot
    • 🤩1000X Trading
    • 📪Sub Account
    • 🧑Referral Program
    • 🔰Multi-collateral system
      • Leverage your earning with mUSDC!
    • 🧲Flexible Earn
    • 🔐JOJO airdrops and staking
  • Smart Contract
    • 🎯Contract Addresses
    • 🕵️Bug Bounty & Audit
  • JOJO TOKEN
    • 📊Allocation
    • 🔒Token Economy
  • Arbitrum Alpha Test
    • 🤝Sunset Plan
    • 🎯Contract Addresses
    • ⚗️STIP
    • 🎙️Announcement
      • 🪙JOJO has listed WLD/USDC, AGIX/USDC, AR/USDC, STRK/USDC and 13 new trading pairs!
      • 🧰Notice of Legacy Network Decommissioning
      • 🧰Smart Contract Upgrade Announcement
      • 🔧Maintenance Notice
      • 🔮BIG UPDATE of JOJO's Bizarre Adventure: all points earned x 100!
      • 🪙JOJO has listed MEME/USDC!
      • 🔮JOJO's Bizarre Adventure Event is now alive!
      • 💰New collaterals: ARB!
      • 💰New collaterals: wstETH and GMX!
      • 🪙JOJO has been listed ARB/USDC, SOL/USDC, and LINK/USDC!
      • 🔖Notification of Environment Removal
  • LEGAL
    • Risk Reminder
    • Terms of Use
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On this page
  • What is Funding Rate?
  • How Does Funding Rate Impact Traders?
  • How Does It Work?
  • How are Funding Rates calculated on JOJO?
  1. v1 Product guides

Funding Rate

Introducing JOJO Funding Rate

PreviousPricesNextLiquidation

Last updated 1 year ago

What is Funding Rate?

Funding rates are periodic payments made to either long or short traders, calculated based on the difference between the perpetual contract prices and spot prices. It is designed to prevent long-term discrepancies between perpetual contract markets and spot prices. It is recalculated several times a day – JOJO does this every 8 hours.

JOJO provides a clear display of funding rate and a countdown to the next funding period for the convenience of its users.

How Does Funding Rate Impact Traders?

The impact of funding rates on traders can be significant as funding calculations take into account the amount of leverage used. If a trader uses high leverage and pays for funding, they may suffer losses and end up getting liquidated even in low-volatility markets. Conversely, if a trader collects funding, it can be profitable, particularly in range-bound markets. Therefore, traders can create trading strategies to benefit from funding rates and make profits even in low-volatility markets. Essentially, funding rates are intended to incentivize traders to take positions that maintain perpetual contract prices in line with spot markets.

How Does It Work?

This model of paying a penalty to the side that deviates from the target price to the side that maintains the target price is the funding fee system of perpetual. Through such reward and punishment measures, the designer of perpetual urges the party whose price deviates in the contract market to adjust, and finally makes the contract price converge with the spot price. In the event of a positive funding rate, it is typical for the perpetual contract price to exceed the mark price. Consequently, traders with long positions must pay for short positions. Conversely, a negative funding rate dictates that short positions must compensate long positions. It is important to note that funding rates are exchanged between peers, and as such, JOJO takes no fees from funding rates as they happen directly between users.

How are Funding Rates calculated on JOJO?

The Funding Rate is calculated as follows:

F = Clamp (average_P + Clamp(I - average_P, -0.05%, 0.05%) , max_F, min_F )

Among them, F = Funding Rate, P= Premium Index, I = Interest Rate, Max_F = Maximum value(around 1%), Min_F = Minimum value (around -1%)

There are two components to the Funding Rate: the Interest Rate and the Premium. On JOJO, the default daily interest rate is fixed at 0.03% (0.01% per funding interval, which occurs every 8 hours).

There might be a significant price difference between the perpetual contract and the Mark Price. In such cases, a Premium Index is used to ensure that the prices in both markets converge.

The Premium Index is calculated separately for each contract using the following formula:

Premium Index (P) = [Max(0, Impact Bid Price - Index Price) - Max(0, Index Price - Impact Ask Price)] / Index Price

Impact Bid Price = The average fill price to execute the Impact Margin Notional on the Bid Price Impact Ask Price = The average fill price to execute the Impact Margin Notional on the Ask Price

Index price means the real-time spot price of the market. It is an average of the prices on the major markets. The value of JOJO's index price is equal to the index price of Binance Perpetual.

Please note that the update of the funding rate will cease if there is a lack of sufficient index price samples. If 80% of the data points are not collected, the funding fee for the eight-hour period will either fail or pass. "Pass" indicates that there will be no change in the funding fees for this round, and the calculation will be carried forward to the next eight hours.

You can view the real-time and historical Funding Rates by clicking .

⚖️
here
JOJO funding rate and countdown