DueDEX calculates the Premium Index (P) and Interest Rate (I) every minute and then performs a 8-Hour Time-Weighted-Average-Price (TWAP) over the series of minute rates.

The Funding Rate is next calculated with the 8-Hour Interest Rate Component and the 8-Hour Premium / Discount Component. A +/-0.05% dampener is added.

**Funding Rate (F) = Premium Index (P) + clamp (Interest Rate (I) - Premium Index (P), 0.05%, -0.05%)**

Formula above is equivalent to below:

When I – P >= 0.05%，F = P + 0.05%

I – P <= -0.05%，F = P – 0.05%

-0.05% < I – P < 0.05%，F = I

The Funding Amount to be paid or received at the Funding Timestamp will be finally calculated by Funding Rate above and position value.

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