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

August 10th, according to TradingBeats (formerly Hyperinsight) monitoring, the current KAITO hourly funding rate has further dropped to approximately -0.334%, lower than the recent 7-day P5 level. Based on the current static rate, a $10,000 short position needs to pay longs about $33.4 per hour, around $801 for 24 hours. Longs' expected annualized funding rate 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 decreased to around $8.056 million, a 52.1% drop from 24 hours ago when it was $16.83 million.

The price drop is significantly smaller than the OI decline, and negative rates, contract discount, and position shrinkage have occurred simultaneously. It is closer to the deleveraging and pricing imbalance formed after rapid long and short exits, rather than a surge of new short positions.

Even though an extremely negative funding rate favors longs, it has not prevented existing longs from continuing to exit.

A whale with an address starting with 0x2be became one of the main longs liquidated in this round. The average KAITO holding price of this address was about $1.0559. Starting this morning, they consistently closed their long position until the evening, selling off 2.086 million KAITO tokens and exiting the position. The weighted average liquidation price was around $0.6695, with a closing transaction amount of about $1.396 million, resulting in a cumulative realized loss of approximately $806,000.

For comparison, converting all platform rates to an 8-hour basis, Binance's current KAITO funding rate is about -1.5347%, while Hyperliquid 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 payment of about $153.5 to longs, while on Hyperliquid, it would be around $262.9, a difference of about $109.5.

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