Traders familiar with forex or CFDs know about "overnight fees." So do crypto futures charge extra for holding overnight? Short answer: crypto perpetual contracts don't have a traditional "overnight fee," but they do have a funding rate — and the effect is similar. This article explains the real cost of holding positions overnight. Start by registering on Binance and downloading the official Binance app (Apple users see the iOS installation guide) to view funding rate information on the trading page.
Do Crypto Futures Have an Overnight Fee?
Strictly speaking, crypto futures don't have a traditional "overnight fee" (also called a swap fee or rollover interest). However, perpetual contracts have a funding rate mechanism charged every 8 hours — day or night. So while the name differs, holding overnight does incur funding rate costs.
Comparison with traditional overnight fees
Traditional overnight fees (Forex/CFD):
- Charged once at 5 PM New York time
- Triple charge on Wednesdays (for the weekend)
- Rate set by the broker
- Paid to the broker
Crypto funding rates:
- Charged every 8 hours (UTC 00:00, 08:00, 16:00)
- Year-round, no triple charges
- Rate determined by market supply and demand
- Exchanged directly between longs and shorts; the exchange takes no cut
Actual Overnight Holding Costs
How many funding rate charges occur overnight?
Suppose you open a position at 10 PM Beijing time and close at 8 AM the next day:
- UTC 00:00 (8 AM Beijing) triggers one funding charge
- So one overnight hold incurs roughly 1 funding payment
For a 24-hour hold:
- 3 funding charges
- 21 per week, ~90 per month
How much is the rate?
Under normal market conditions, the funding rate is about 0.01% per 8 hours.
For a 10,000 USDT position:
- Per charge = 10,000 × 0.01% = 1 USDT
- Per day (3 charges) = 3 USDT
- Per month ≈ 90 USDT
- Annualized ≈ 1,095 USDT (~10.95%)
Extreme conditions
When market sentiment is at an extreme, the rate can spike:
- Bull market peaks may reach 0.1% or higher
- Per charge = 10,000 × 0.1% = 10 USDT
- Per day: 30 USDT, per month: 900 USDT
- Annualized can exceed 100%
The Funding Rate Isn't Always a Cost
The rate can be positive or negative, meaning you don't always pay:
If you're long
- Positive rate (longs pay shorts): You pay
- Negative rate (shorts pay longs): You receive
If you're short
- Positive rate: You receive
- Negative rate: You pay
Most of the time the rate is positive
During bull markets or prevailing bullish sentiment, the funding rate is usually positive — longs pay. In bear markets, the opposite.
Do Delivery Contracts Have Overnight Fees?
Delivery (dated) contracts have no funding rate — holding overnight costs nothing. This is an advantage over perpetual contracts. If you plan to hold for days or weeks, delivery contracts may cost less overall.
However, delivery contracts have expiry dates and require settlement or rollover.
How to Reduce Overnight Holding Costs
Monitor rate trends
Open positions when rates are low or negative to reduce — or even earn — funding fees.
Avoid high-rate windows
If the rate is abnormally high, close before the charge and reopen after. But frequent trading generates commission costs, so weigh the trade-off.
Use delivery contracts
For multi-day or multi-week holds, delivery contracts eliminate funding rate costs entirely.
Short to earn the rate
In bull markets where rates are persistently positive, running a spot long + contract short arbitrage can earn steady funding payments.
Choose exchanges with lower rates
Funding rates vary by exchange. Picking one with lower rates saves money.
Complete Holding Cost Calculation
The full cost of holding a futures position:
- Opening fee – One-time
- Funding rate – Every 8 hours (perpetual only)
- Closing fee – One-time
Example: 10,000 USDT position held for 3 days
- Opening fee (Taker) = 10,000 × 0.05% = 5 USDT
- Funding (9 charges at 0.01%) = 10,000 × 0.01% × 9 = 9 USDT
- Closing fee (Taker) = 10,000 × 0.05% = 5 USDT
- Total cost = 5 + 9 + 5 = 19 USDT
Using limit orders (Maker) lowers the open/close fees:
- Opening fee (Maker) = 10,000 × 0.02% = 2 USDT
- Closing fee (Maker) = 10,000 × 0.02% = 2 USDT
- Total cost = 2 + 9 + 2 = 13 USDT
FAQ
Does the exchange collect the funding rate?
No. It's paid directly between longs and shorts. The exchange only facilitates the transfer.
If I close seconds before the funding timestamp, do I still pay?
If you have no open position at the funding moment, you don't pay. But be aware of execution delays.
How much does a month of funding cost?
Under normal conditions: ~0.01% × 90 charges ≈ 0.9% of position value. In extreme markets: 5%–10% or more.
Are delivery or perpetual contracts cheaper for holding?
For short-term holds (hours), the difference is minimal. For medium to long-term holds, delivery contracts are usually cheaper because there's no funding rate.
Safety Tips
- Before holding any position long-term, check the current funding rate and its historical trend
- Very high funding rates often signal an imminent market reversal — be cautious about opening positions at those times
- Use the official Binance app to monitor funding rates and holding costs in real time
- Include the funding rate in your trading cost calculations to avoid "winning the trade but losing to fees"
- Futures trading is high-risk; the longer you hold, the more risk accumulates — manage your exposure wisely