Funding Rate Crypto Interview Guide
Funding rate crypto interview guide for perpetual futures, long-short payments, premium, basis, carry, examples, and risk caveats.
Candidates explaining how perpetual futures stay linked to spot markets.
Funding is a periodic transfer
In many perpetual futures setups, funding payments move between longs and shorts. The purpose is to discourage persistent divergence between perpetual and spot markets.
Positive funding is not pure edge
A trader receiving funding may still face price movement, liquidation, fees, basis shifts, venue risk, and collateral constraints. The net economics require all components.
Concrete example
If the perpetual trades rich to spot and shorts receive funding, a basis-style position still needs spot execution, margin, and a plan for changing funding rates.
Funding can change quickly
Funding depends on market conditions and venue rules. A backtest or interview example should not assume a historical rate persists unchanged.
Common mistakes
Candidates often annualize a funding number and stop. A stronger answer includes volatility, financing, execution, liquidation, and regime-change risk.
Practice the pattern
Use the LeetQuidity curriculum and calibration to turn this topic into a focused practice plan.