Funding & borrowing

Why holding costs exist

Perpetual positions have no expiry, and the liquidity vault is on the other side of every trade. Ongoing charges keep that arrangement fair over time:

• Funding balances the market. When far more traders are long than short (or the reverse), the crowded side pays the other side a small periodic rate. This nudges open interest back towards balance and reduces the vault's one-sided risk.
• Borrowing pays the vault for the capital your leverage uses. It accrues on the position size for as long as the position is open.

How they're charged

Both accrue continuously and are settled against your collateral, so a position held for a long time slowly loses margin even if the price doesn't move. Keep an eye on your liquidation price on long-held positions.