EVA Help

Funding and Basis

What it is

Funding is a regular payment between longs and shorts on perpetual futures. Positive means longs pay shorts: more traders want to be long. Negative is the opposite. Basis is how much more (or less) the future costs than spot. Both show which way leverage is skewed.

More: how we calculate it

What it looks like in EVA

BTC · 1h · 09.10 07:00 MSK — "Cost of Leverage" pane: market funding (per 8 h) and basis, %Show on chart

How it is read

Typical patterns: how traders read them and use them, and for each one a real moment from our history where it played out as a "textbook case". Moments where the same pattern failed are below, in "When it does not work".

1. Funding far above usual for the coin

How it is read: longs pay a lot — the market is overheated with leverage on the long side. Many expect a shakeout down that flushes out excess longs.

Bybit funding 0.0100% — in the coin's top 5% for the month; then as expected: 1% down within 8 h
textbook caseSOL · 1h · 07.10 23:00 MSK — Bybit funding 0.0100% — in the coin's top 5% for the month; then as expected: 1% down within 8 hShow on chart

2. Funding negative and far below usual

How it is read: shorts pay — positioning is skewed short. Many expect a short squeeze up.

Bybit funding −0.0125% — in the bottom 5%; then as expected: 1% up within 5 h
textbook caseSOL · 1h · 05.10 19:00 MSK — Bybit funding −0.0125% — in the bottom 5%; then as expected: 1% up within 5 hShow on chart

3. Futures trading noticeably above spot

How it is read: traders overpay for long leverage. It is read as an overheated futures market.

Bybit basis +0.009% — in the top 5%; then as expected: 1% down within 2 h
textbook caseSOL · 1h · 22.09 04:00 MSK — Bybit basis +0.009% — in the top 5%; then as expected: 1% down within 2 hShow on chart

When it does not work

No pattern works every time: funding and basis explain where leverage is overheated better than they tell when the overheating will end.

The same patterns — moments from our history where they failed.

Bybit funding 0.0100% — in the coin's top 5% for the month; then the opposite: 1% up within 8 h
pattern failedSOL · 1h · 04.10 05:00 MSK — Bybit funding 0.0100% — in the coin's top 5% for the month; then the opposite: 1% up within 8 hShow on chart
Bybit funding −0.0067% — in the bottom 5%; then the opposite: 1% down within 3 h
pattern failedETH · 1h · 07.10 17:00 MSK — Bybit funding −0.0067% — in the bottom 5%; then the opposite: 1% down within 3 hShow on chart
Bybit basis +0.018% — in the top 5%; then the opposite: 1% up within 2 h
pattern failedSOL · 1h · 19.09 02:00 MSK — Bybit basis +0.018% — in the top 5%; then the opposite: 1% up within 2 hShow on chart

Common traps

See also