Timed Perps

Some perpetuals markets on Butter.xyz are designed to allow traders to take positions on short-term, volatile assets. These assets keep the attention of the crypto community for anywhere between a day and a few weeks, and their corresponding markets on Butter.xyz implement a funding event procedure to reflect the transient lifecycle of the underlying assets.

Funding events in these markets begin in the same way as for any other perpetuals market, but begin to phase out after a predetermined amount of time.

Funding phase out procedure

Short-term markets have a funding phase out time, and a funding rate half life. For example, a market with a funding phase out time of October 10 12:00 and a half life of one day will pay funding as normal until October 10. At 12:00 on October 10, funding will be cut in half; at 12:00 on October 11, funding will be cut in half again; and so on every day afterwards. The funding rate will stop decreasing after 20 half lives. However, please note that the minimum funding rate is 0.0001%; if the calculated funding rate is below the minimum funding rate, no funding payments will occur.

Funding phase out indicators

Short-term markets will have funding rates displayed in orange.

Hovering over the funding rate on a short-term market indicates the state of the market.

Funding has not yet started to reduce. The phase out time is shown.

Funding has begun to phase out. The half life (12 hours in this example) is shown.

Funding has reached its terminal state (after 20 half-lives).