Binance targeted the data used to calculate payments between opposing traders after an overnight connection problem.

Binance said its October 21 stock-futures funding calculation would exclude observations affected by an overnight connection problem. The adjustment covered its US-equity perpetual futures and targeted the inputs used to determine payments between opposing traders.

The exchange’s October 21 notice reported intermittent network connectivity problems at an unnamed US overnight alternative trading system from 03:46 to 06:30 UTC that day. It said premium-index data for the affected period would be removed from the 08:00 UTC funding-rate calculation for all TradFi perpetuals with US equities as their underlying assets.

Under Binance’s funding methodology, funding is a periodic transfer between holders of long and short perpetual positions. When the rate is positive, longs pay shorts; when it is negative, shorts pay longs. Binance says it charges no fees on these transfers. The amount depends on the position’s nominal value multiplied by the applicable funding rate.

The premium index is part of that rate calculation. It compares prices at which a specified amount could be bought or sold in the futures order book with a reference price index. Binance then averages premium observations over the applicable funding period.

Excluding the affected observations would change that input set. The announced intervention therefore addressed the data used to calculate funding, rather than promising to cancel the payment itself.

Start with the stories that matter. Get the context behind the headlines and a clear view of what to watch next.

Source link