The funding payment is calculated every single hour. Traders with open long or short positions will pay each other a funding payment, depending on market conditions. If the contract price is above the spot price, longs pay shorts and vice versa. The funding payment is a function of the difference between the contract price, spot price, and the position size. Savvy investors are rewarded for bringing the contract price near to the spot price. The protocol employed by fxdx uses a funding rate mechanism similar to FTX, allowing new derivative markets to trade with leverage. While at the same time monitoring an underlying index. The funding payment is calculated based on the formula below.