Funding Rate Perpetuals (HYPE-USDC)

This perpetual contract allows traders to speculate on or hedge the funding rate of HYPE perpetuals, isolating the "cost of carry" from the price of HYPE itself.

Characteristic

Description

What it Tracks

The annualized funding rate of HYPE perpetuals.

Index Definition

I_t (The Index): A continuously updated cumulative coupon index representing the total, time-weighted HYPE funding rate paid out by the contract.

I_t = ∫(r_s/D_hr)ds. D_hr= 8760. Here r_s is the signed, annualized funding rate of the HYPE perpetual at time s.

Oracle Type

An Always-In-Session Oracle that operates 24/7 without weekend or off-hours policies.

Market Type

Funding-Rate Perpetual. This contract is a direct swap on the annualized funding rate.

PnL Formula

PNL (Long) = Position_Notional × (I_exit - I_entry)
PNL (Short) = Position_Notional × (I_entry - I_exit)

Where:

Position_Notional: The total USD notional value of the position.
I_entry / I_exit: The value of the Cumulative Coupon Index when the position is opened and closed, respectively.

Use Cases

Long:

• Receive fixed, pay HL funding → “Cap my funding-cost if I’m long BTC elsewhere.” • Lock-in predictable APR when running basis trade. • Get paid when BTC funding spikes. • Speculate on bull-run long premium. •Hedge a long BTC position on HL or binance (which pays funding) Short:

• Pay fixed, receive HL funding → “Get paid when BTC funding collapses.” • Hedge a short-BTC position on HL or Binance (which receives funding). • Profit if funding collapses negative in bear market.

Users

• Basis Desks & Delta-Neutral Funds

• Quantitative Hedgers

• Sophisticated HYPE Traders & Speculators

Vol-stat (σ)

Moderate: while variable, it is expected to be in a similar range to other major asset funding rates (e.g., ~40 bp/yr), though it can be higher during periods of extreme sentiment around HYPE.

Margin Numbers

Derived from the Max Leverage tiers. For the initial 4x leverage tier, the Initial Margin (IM) is 25% of the notional position value.

Times

Exchange/funding: 24/7.
Oracle: 24/7; one session only.
Finalization clock: HH:00 UTC each hour.

We use no weekend/off‑hours windows. The weighting policy is constant over the full week.

OraclePx

Baseline (no blend)

Because HYPE funding is always in session, the published rate is simply the live session signal:

\boxed{r_t = r_{\text{session}}(t)}

What powers r_session(t)?

A. Hourly finalization.

At each hour boundary t_h, ingest the realized HYPE funding for [t_h-1, t_h]. If the venue provides per‑hour decimal funding fr_hour,

B. Intra‑hour nowcast (projection).

Within the hour, the pending function is using a premium‑based model:

r_{\text{now}}(t) = \kappa \cdot \frac{\text{PerpMid}(t) - \text{SpotIndex}(t)}{\text{SpotIndex}(t)} \cdot 8760 + \theta^\top \mathbf{z}(t),

κ: premium → funding slope; this is re‑fit daily on 30–60 days of overlapping data (5‑min bars). Outliers are winsorized. This is ridged if ill‑conditioned.
z(t): stability features (depth/impact, skew).
θ (the Learned Coefficients Vector): a vector of pre-calculated weights or coefficients. Each weight corresponds to one of the stability features in z(t). These coefficients are determined by statistically analyzing historical market data to learn how much each feature (like depth or skew) has historically influenced the final, realized funding rate, independent of the simple premium.
Optional EMA smoothing: τ_EMA≈ 1h.

C. Session signal.

The r_session(t) equation defines the official, annualized funding rate for the HYPEYLD-PERP at any given moment t. This is the final rate used to update the perpetual's Cumulative Funding Index (I_t):

r_{\text{session}}(t) = \begin{cases} r_{\text{now}}(t), & t \in (t_{h-1}, t_h)[2pt] r_{\text{final}}(t_h), & t = t_h \end{cases}

r_session(t) (the Session Signal): the final, published annualized funding rate at time t.
r_now(t) (the "Nowcast"): the intra-hour projection of the funding rate.
r_final(t_h) (the Finalized Rate): the hourly ground truth.
t: the current time.
t_h: the precise timestamp of an hour boundary (e.g., 13:00:00 UTC, 14:00:00 UTC).

MarkPx

Funding Index (CFI)

I_t is a continuously updated cumulative coupon index representing the total, time-weighted HYPE funding rate paid out by the contract. Let r_t be the annualized rate:

I_t = \int_0^t \frac{r_s}{8760},ds, \qquad dI_t = \frac{r_t}{8760},dt.

Intra‑hour: integrate the nowcast r_now(t).
Hourly: at t_h, finalize with r_final(t_h):

(I_{h^+} \leftarrow I_{h^-} + \tfrac{r_{\text{final}}(t_h)}{8760}).

FR‑Perp Mark

PerpPx_t is the primary oracle price, the theoretical dollar price derived purely from the I_t index:

\text{PerpPx}_t = B_t + S,\big(I_t - A_t\big),

S>0: scale (notional per contract).
A_t: piecewise‑constant anchor to keep prices in a wide positive band; when A_tchanges, adjust B_t atomically so PerpPx is continuous.
PnL invariance: for q contracts N=qS, dPnL=N,r_t/8760,dt; at each hour N x fr_hour is realized.

MarkPx for risk (median of variants):

MarkPx0: PerpPx_t (oracle pure).
MarkPx1: PerpPx_t + EMA_150s(PerpPx_t-midPx_t).
MarkPx2: Venue local mark (if any).
Published MarkPx: median (MarkPx0, MarkPx1, MarkPx2) under the same clamp/precision rules.

ExternalPerpPx

The venue uses an external band anchor:

Band: ±min(1/maxLeverage,20%).
Policy: ExternalPerpPx = PerpPx (or a slow EMA of PerpPx for extra stability).
Note: There is no weekend‑specific behavior; policy is identical 24/7.

Worked Example

A trader wants to hedge $10,000,000 notional of an external long BTC perp.
The reference market's realized funding for the hour is rh = 10% annualized.
The change in our index will be ΔI = 0.10 / 8760 ≈ 1.14155e-5.
The price of our perp will change by ΔP = S * ΔI ≈ 11.4155.
The trader's PnL on Nunchi will be q * ΔP = 10 * 11.4155 = $114.16.
This amount perfectly matches the funding they would pay on their external position ($10M * 0.10 / 8760 = $114.16), demonstrating a successful hedge.