KAITO OI Liquidated, Extreme Funding Rate Now Results in 2900% APY for Longs

BlockBeats News, August 10th, according to TradingBeats (formerly Hyperinsight) monitoring, the current hourly funding rate of KAITO has further dropped to about -0.334%, lower than the recent 7-day P5 level. Based on the current static calculation of the rate, a $10,000 short position needs to pay about $33.4 to long positions every hour, approximately $801 in 24 hours. The long position's expected annualized funding rate income is about 2923%.

KAITO is currently trading at $0.6577, with a 24-hour decline of about 4.3%, the mark price is approximately 2.98% lower than the oracle price; the open interest value has further dropped to about $8.056 million, a 52.1% decrease from 24 hours ago.

The price drop is much smaller than the OI decrease, and the negative rate, contract discount, and position contraction have occurred simultaneously. This is more indicative of deleveraging and pricing imbalances formed after the rapid exit of both long and short positions, rather than a surge in new short positions.

Even though an extremely negative funding rate favors long positions, it has not been able to prevent existing longs from continuing to exit.

One of the main long positions liquidated in this round is a whale address starting with 0x2be. The average KAITO position of this address was around $1.0559, and starting this morning, it has been consistently closing long positions. By evening, it had sold 2.086 million KAITO tokens and cleared its position, with a weighted average closing price of about $0.6695, a closing transaction amount of about $1.396 million, realizing a cumulative loss of approximately $806,000.

For comparison, when converting all platform rates to an 8-hour basis, Binance's KAITO current funding rate is about -1.5347%, and Hyperliquid's is about -2.6293%. The absolute value of Hyperliquid's negative rate is 1.0946 percentage points higher, approximately 1.71 times that of Binance.

Calculating for a $10,000 short position, every 8 hours on Binance would require paying about $153.5 to long positions, while on Hyperliquid, it would be about $262.9, a difference of about $109.5.

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