FOREVER MARKETS
Funding
The crowded side pays the minority side; LP utilization is charged separately.
Payer-to-receiver funding
When NVIDIA OI exceeds AMD OI, NVIDIA positions pay. When AMD OI is larger, AMD positions pay. If there is opposing OI, collected funding is reserved and credited to the minority side instead of being treated as LP revenue.
The rate scales with directional imbalance and with D × (1 − D), which naturally falls near the bounded endpoints. Peer funding is capped at 50 bps per day before utilization scaling.
LP utilization fee
A separate fee compensates the vault when unmatched exposure consumes loss-cover capacity. It depends on each side’s uncovered endpoint deficit relative to available LP capital and is capped at 10 bps per day.
Keeping utilization fees separate prevents the minority trader’s funding credit from being silently diverted to LPs.
Checkpointing
Funding accrues through indices and is applied when the market or position is checkpointed. Each accrual call processes at most one hour of elapsed time, preventing an extreme catch-up charge after a long inactive period.
If funding exceeds remaining equity, the position closes through funding exhaustion. For 1× positions, funding can shrink units while keeping the position fully funded.