What is funding on a perpetual future?

A perpetual future has no expiry, so nothing forces its price back to the underlying. Funding is the mechanism that does it: a small payment made every hour between the two sides of the market. When the perp trades above the index the rate is positive and longs pay shorts; when it trades below, shorts pay longs. It is a transfer between traders, not a fee paid to the venue.

Can you earn yield by holding a tokenized stock and shorting the perp?

Sometimes. If you hold a tokenized stock and short the same company's perpetual at the same size, the two price exposures roughly cancel, and while funding is positive the short side collects it. That is the whole idea behind a funding carry. It is not a yield in the sense a vault pays one: the rate is set by trader positioning, resets every hour, and can turn negative without warning, at which point the position costs money to hold.

Why does the 14-day average funding rate matter more than the current rate?

Because the current rate is one hour's reading of something that moves constantly. Across the tokenized-stock perp markets tracked here, 54 of 59 changed sign at least once in the last fortnight, and on one market the spot rate read −48% annualised against a 14-day mean of +85%. Sizing a position on the instantaneous number tells you almost nothing about what holding it would have paid.

What are the risks of a delta-neutral tokenized stock hedge?

Funding can flip against you; the perp can be liquidated on an upward move even though your token gained the same amount, because the two sit in different places and only one has a margin requirement; the token and the perp can diverge because they price off different feeds; corporate actions adjust the token's multiplier and the perp's contract separately; and fees, spreads and the collateral you must post all come out of the carry. The position is hedged against price, not against those.

Perp funding and the delta-neutral hedge

Registry snapshot September 30, 2026

If you hold a tokenized stock and short the same company’s perpetual future at the same size, the two price exposures roughly cancel. What is left is the funding rate — and when it runs one way, the hedged position earns it. This page explains the mechanism, and then spends most of its length on the ways it goes wrong, because that is the part that decides whether it was a good idea.

Opposing tokens on a balancing mechanism illustrate a hedge and its funding flows.

What funding actually is

A perpetual future never expires, so nothing drags its price back toward the share it tracks. Funding is the mechanism that does that job: a small payment made every hour, directly between the two sides of the market.

Positive funding — longs pay shorts. The perp is trading above the index, so holding it long costs money each hour and holding it short receives money.
Negative funding — shorts pay longs. The perp is below the index, and the payment runs the other way.

It is a transfer between traders, not a fee to the venue, and it is reset every hour. Nobody promises it. It is the market’s current price for being on one side rather than the other.

The hedge

Say you hold a tokenized Meta — METAc, METAx, METAon, whichever wrapper — and you short the META perpetual at the same notional size. Meta rises 10%: your token gains and your short loses, roughly cancelling. Meta falls 10%: the same in reverse. Your exposure to the share price is close to flat, which is what delta-neutral means.

What you are left holding is the funding stream. While funding is positive, the short side collects it every hour, and that is the return the position is actually for.

The other reason to put it on

The same structure does a second job that has nothing to do with yield. If a stock you hold has run up hard and fast and you think a pullback is coming, you can short the perp against it rather than selling the token: you keep the position, you neutralise the move you are worried about, and if funding happens to be positive you are paid to wait. When the pullback comes — or does not — you close the perp and keep the stock.

That framing matters because it sets a different bar. Here the funding is a rebate on the cost of a hedge you wanted anyway, not the reason for the trade. A hedge that costs a little is still a hedge; a carry trade that costs a little is just a loss.

Why the average is the number to read

The rate any venue shows you is the current hour’s. It is close to useless as a guide to holding anything, and the data on this site is blunt about it: of the 59 tokenized-stock perp markets tracked, 54 changed sign at least once in the last fortnight. On one of them the spot rate read −48% annualised against a 14-day mean of +85% — the two numbers do not merely differ in size, they point in opposite directions.

This is why the perps desk leads with funding over the last 14 days rather than the spot rate, and why every funding cell opens a daily chart. The average alone is not enough either: a steady 12% and a fortnight that swung between +40% and −30% average out the same and are completely different positions to hold. The chart is there so you can tell which one you are looking at.

How this goes wrong

The position is hedged against the share price. It is not hedged against any of the following, and every one of them has ended this trade badly for somebody.

Funding flips. The rate that paid you last week can pay the other side this week. Nothing stops it and nothing warns you. A carry that has to be monitored hourly is a job, not an income.
The two legs live in different places. Your token is in your wallet; your short is on a venue that needs its own collateral, usually a stablecoin. The hedge does not fund itself — you have to post margin separately, and that capital is doing nothing else.
You can be liquidated while being right. If the stock rises sharply, your short loses margin on the venue while your token gains value in your wallet. The two do not net against each other, because the venue cannot see your wallet. Thin margin plus a fast move liquidates the short and leaves you unhedged and long at the top.
The legs can diverge. The perp prices off its venue’s own oracle and the token prices off its issuer’s. Those can disagree, especially outside market hours, when the share itself is not trading and both feeds are holding a stale value. The desk prints a market’s drift from the real quote for this reason.
Corporate actions hit the two legs separately. A split or a dividend changes the token’s multiplier — see dividends and corporate actions — while the perp’s contract is adjusted by the venue on its own terms. A hedge that was the same size on Friday need not be on Monday.
Costs come out of the carry. Trading fees, the spread on both legs, and the opportunity cost of the posted collateral are all paid in full whether funding runs your way or not.
Thin markets quote rates nobody can take. A four figure annualised rate on a market with almost nothing traded is an extrapolation from a handful of hours, not an opportunity. Read the 24h volume and open interest beside it.
Access is not universal. Several issuers do not offer their tokens to US persons, and perp venues have their own restrictions. Both legs have to be available to you for any of this to be possible at all.

What to look at before sizing anything

Nothing on this site tells you what a position would earn, and that is deliberate: multiplying a funding rate by a balance produces a number that reads as a forecast while being an annualisation of the last fortnight. What is worth reading instead, all of it on the perps desk:

The 14-day mean, and whether the daily chart behind it sits on one side of zero or crosses it repeatedly.
Open interest and 24h volume, which say whether the market is deep enough to enter and leave at size.
The drift between the venue’s index and the real quote, which says whether the market is tracking the company you think it is.

Informational only. This is not investment advice, not a recommendation to trade, and not an offer. Perpetual futures are leveraged instruments and positions can be liquidated in full. Tokenzo holds no keys, takes no custody and moves nothing.