KuCoin's Hourly Funding Rule: A New Risk Factor for Perpetual Contracts

KuCoin has activated an automatic mechanism that changes the funding settlement period for certain perpetual contracts to hourly when their funding rate reaches a contract-specific cap or floor. This rule was implemented on August 17 after 08:00 UTC and applies to USDT- and USDC-margined perpetual contracts.

The trigger condition is based on the funding rate at the scheduled settlement, with a threshold of plus or minus 0.002% from the contract's upper limit. If the funding rate meets this threshold, the contract will move to hourly settlement for the next period, without requiring a separate announcement.

Under this mechanism, traders can expect more frequent funding debits and credits, but the cumulative cost still depends on the realized rates, position side, size, and duration. The exchange notes that its funding calculations, limits, and user positions remain unchanged.