Hyperliquid's 500% Bonus for Long Oil Traders Sparks Funding Frenzy
Crypto exchange Hyperliquid has been paying traders to hold long oil derivatives, offering an hourly reward on top of price appreciation. The payout is a staggering 500% per annum, making it difficult for short-sellers to compete.
The extreme leverage offered by Hyperliquid, up to 20x on Brent oil, makes it easy for intraday price fluctuations to wipe out a portfolio.
Funding rates on the exchange have been deeply negative, indicating that the short side of the trade is overcrowded and must pay fees to borrow margin exposure from longs.
The current funding rate mismatch between shorts and longs is incredible, with longs winning recently despite Brent oil trading below its $126 peak since April 30.
The Iran war has kept squeezing seaborne supply and global logistics for millions of barrels that the world burns daily, contributing to the recent rally in oil prices.