Arcus explains funding rates for equity perpetuals during trading hours and weekends

Summary

Arcus has provided an in-depth explanation of funding rates for equity perpetuals (perps), emphasizing their role in maintaining price alignment with underlying assets. Unlike traditional futures contracts, which have specified expiration dates, equity perps allow traders to hold positions indefinitely, which necessitates a funding mechanism to prevent price divergence. When the market is open, funding rates are based on a combination of a premium—reflecting the price difference between the perp and the underlying asset—and a base rate, which accounts for the cost of holding a leveraged position. When equity markets close, the funding rate switches to a fixed base rate, ensuring stability until reopening. This update follows the recent launch of isolated margin positions on Arcus in September 2026, enhancing risk management options for traders.

Analysis

Arcus: Arcus is a blockchain-based smart contract protocol enabling self-custodial peer-to-peer trading of Stock Tokens, cryptoassets, and perpetual futures on Robinhood Chain. It operates in beta with features for 24/7 equity perps trading and recently introduced isolated margin positions. The protocol is the subject of the news explaining its equity perp funding rate mechanics during and outside market hours. Stock Tokens: Stock Tokens are tokenized securities on Arcus that provide economic exposure to underlying equities or ETPs via contractual claims. They enable 24/7 spot trading alongside perpetual futures on the platform. The news context ties them to equity perps as the underlying assets tracked by funding mechanisms. Pocket Protector Labs Inc.: Pocket Protector Labs Inc. is the company behind the Arcus protocol and was previously acquired by dYdX Labs. It is led by CEO Eddie Zhang and handles development and operations for Arcus in partnership with Robinhood Crypto. The entity appears in Arcus disclaimers as the responsible party for the protocol. Product Update: Isolated margin positions became live on Arcus in early September 2026, allowing users to cap risk on individual perps trades. Trading Mechanics: Equity perps on Arcus maintain continuous trading with funding rates that switch to a fixed base rate when underlying equity markets close, as detailed in late July and September platform updates.

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