> For the complete documentation index, see [llms.txt](https://docs.zirodelta.com/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.zirodelta.com/hyperliquid/funding-rates.md).

# Funding Rates on Hyperliquid

Hyperliquid settles perpetual funding every **1 hour**. Binance, Bybit, and OKX settle every 8 hours. That difference matters for compounding, for how fresh the signal is, and for how the Yield Engine times entries. It is one of the reasons the Yield Engine runs on Hyperliquid.

## Settlement frequency comparison

| Exchange        | Settlement interval | Settlements per day | Settlements per year |
| --------------- | ------------------- | ------------------- | -------------------- |
| Binance         | 8 hours             | 3                   | 1,095                |
| Bybit           | 8 hours             | 3                   | 1,095                |
| OKX             | 8 hours             | 3                   | 1,095                |
| **Hyperliquid** | **1 hour**          | **24**              | **8,760**            |

Hyperliquid settles eight times more often than the major centralized exchanges.

## Why it matters

### More frequent compounding

When the Yield Engine earns funding from the pool's delta-neutral position, the pool receives a payment every settlement period. On Binance that is three payments a day; on Hyperliquid it is twenty-four smaller ones. The same rate compounds more favorably at higher frequency, and that compounding accrues to the value of your wzdUSD share. The effect is modest day to day and adds up over weeks and months.

### Faster signal

Hyperliquid publishes a **predicted funding rate** for the upcoming hour, updated roughly every two seconds. On a 1-hour cycle the next settlement is actionable within minutes, so the Yield Engine can react to a rate turning negative within the hour instead of waiting up to eight hours. (See the risk side of this in [Delta-Neutral Explained](/the-zirodelta-financial-engine/delta-neutral-explained.md).)

### Entry timing

On 8-hour venues the best entry is just after a settlement, to capture the full window. On Hyperliquid the next settlement is at most 59 minutes away no matter when you enter, so entry timing is forgiving.

## How the predicted rate works

Hyperliquid computes a predicted funding rate from the premium between the perpetual price and the oracle price:

```
premium = (markPrice - oraclePrice) / oraclePrice
predicted = clamp(premium / fundingIntervalHours, -0.05%, +0.05%)
```

When the predicted rate is high and positive, longs are paying shorts at the next settlement. That is the condition the Yield Engine looks for.

> **A note on annualizing.** A funding rate is a per-hour number. Annualizing it (the per-hour rate times the hours in a year) is just arithmetic on the current rate, not a forecast: funding moves constantly and can turn negative. Any single annualized figure is a snapshot, never a promise. What the Yield Engine earns is variable and can be zero.

> **See also:** [Settlement Mechanics](/hyperliquid/settlement-mechanics.md) · [The Yield Engine](/the-zirodelta-financial-engine/overview.md) · [Key Concepts](/getting-started/key-concepts.md)


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