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The Lab

Ideas traders use, put to the record · updated 30 Oct 2026 21:56 UTC

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#10 Funding apart No sign

The idea

When traders on one exchange pay much more than elsewhere to hold longs, that exchange's longs are crowded: they are the ones forced out next, and the price tends to fall.

Why test it

Hyperliquid is a large exchange whose traders hold their positions on-chain, apart from the big centralised exchanges, and its funding often runs above or below Binance's. If a crowd on one venue is late, the gap between the two should say so before the price does.

What we tested

Every hour, for each coin: Hyperliquid's funding averaged over its last eight hourly payments, less the rate Binance last charged, both as yearly figures. Against: the price change over the next 24 hours. Data: Hyperliquid's and Binance's funding payments, since May 2023, and Binance's archive for the price; 31 coins, 821,757 coin-hours.

Record tested: 08 Jun 2023 – 30 Oct 2026 · first run: 13 Oct 2026 · numbers as of: 30 Oct 2026 03:21 UTC, updated every hour.

What we found

No sign. Nothing the record can tell from chance. After the hours when Hyperliquid was dearest to be long on, the next 24 hours went 10.4 bps better than after the hours when Hyperliquid was cheapest to be long on: $10 on every $10,000.

+1.8-8.9+1.4-5.4+12.1← when Hyperliquid was cheapest to be long onwhen Hyperliquid was dearest to be long on →

Every hour of every coin sorted into five equal groups by the signal, low to high, and the average move over the next 24 hours after each group, in basis points (0.01%) above or below the average move. If the idea were right, the bars would fall from left to right.

How sure

What could still be wrong

A gap can also be traders holding the cheap side on one exchange and the dear side on the other, which closes the gap without moving the price. The coins all move with Bitcoin, so they agree more than independent tests would. Only coins on both exchanges count (MAGIC is not on Hyperliquid). The settings were fixed on 13 Oct 2026, before any of its numbers were seen.

All the numbers

By year · mean rank correlation

+0.032
2023
+0.009
2024
-0.021
2025
-0.001
2026

Other settings · mean rank correlation

next hournext 4 hoursnext 24 hours
mean rank corr.+0.003
t +2.7
+0.000
t +0.3
-0.001
t -0.2

The test above is the next 24 hours; these are the other horizons. With several tries one will look good by luck, so all are shown.

By coin · rank correlation

coinrank corr.
RSR+0.052
GRASS+0.036
SUI+0.033
XRP+0.031
FIL+0.022
DOT+0.021
ETH+0.021
WLD+0.017
SOL+0.013
ADA+0.012
UNI+0.008
W+0.007
APT+0.005
BTC+0.004
AAVE+0.004
STRK+0.004
NEAR+0.003
DOGE+0.003
ENA-0.002
ONDO-0.005
HYPE-0.007
LTC-0.008
INJ-0.011
TAO-0.020
AVAX-0.021
LINK-0.029
ZRO-0.031
TIA-0.032
ZEC-0.048
ARB-0.050
S-0.062

Update, 27 October 2026: where the idea comes from

Added after this page was published. The study above is left as it was.

Credits

← Into the funding paymentMemes behind Bitcoin →

How to read a study: the maths, step by step

1. Basis points (bps). A hundredth of a percent: 100 bps is 1%. 10 bps on $10,000 is $10. Buying and selling once (a round trip) at typical fees costs about 10 bps, so an effect smaller than that loses money.

2. The five groups (fifths). Take every hour of every coin and sort them by the signal, lowest to highest. Cut the pile into five equal groups. For each group, average the price move that followed. Each bar shows its group's move above or below the average of all hours, so a market that simply rose all month doesn't count. If the idea is right, the bars climb (or fall) steadily from one end to the other.

3. Rank correlation (Spearman's). One number for "when the signal is higher, is the move after higher too?" Put the hours in order by the signal (1st, 2nd, 3rd…), and again by the move that followed, then compare the two orders. Five hours in exactly the same order in both give +1; exactly reversed, −1; no pattern, about 0. Markets are noisy, so real effects are tiny: 0.03 held for years is notable. We work it out for each coin, then take the average over the coins.

4. t: more than luck? Even with no real link, an average comes out a little above or below zero by chance. How much it usually wobbles (the standard error) can be worked out from how much the coins disagree with each other. t is the average divided by that wobble. For example, an average of 0.02 with a usual wobble of 0.005 gives t = 4: four times what luck usually makes. Luck alone passes ±2 about 1 time in 20, and ±3 only a few times in 1,000. We ask for ±3, because coins move together and neighbouring hours overlap, which makes luck look surer than it is.

5. "The price bouncing back" taken out. Some signals mostly echo the price's last move: a fall, then a bounce. We remove what that last move already explains and check that what is left still lines up with the move after, with t still beyond ±3.

6. Many settings tried. Try twenty settings and one will look good by luck, so every setting tried is shown under "All the numbers", not only the best.

7. Old data and new data. The settings tested (distances, horizons, thresholds) were set on 12 Oct 2026, after a first look at the numbers (a study added later gives its own dates). The record from 13 Oct 2026 on was unseen when they were chosen, so it is the fair test: each study judges it apart, as "holds on new data", once there is enough of it.

The verdicts. Holds up: every test passed. Real, but small: every test passed but one: the effect is too small to pay for a trade's costs. Partly: more than chance, but some tests failed. A hint: t beyond ±2 but not ±3: perhaps something, perhaps luck. No sign: nothing the record can tell from chance. Too early: under 2 weeks of record. No reliable edge: a write-up's word: what looked good did not hold up against chance or on unseen data. No edge after fees: a write-up's word: there is something, but trading costs eat it. Not shown: a write-up's word: the record could not show that the idea helps. Passed, on a weak bar: a write-up's word: it cleared the bar set in advance, but the bar proved easy; the stricter reading, added after, is shown apart. No reliable gain: a write-up's word: the versions that looked better did not clear the bar set in advance: all three coins, at both a day and a week. Failed on fresh data: a write-up's word: a lead from one study, tested again on prices kept apart, did not hold. Not proven, a lead: a write-up's word: it failed the test set in advance, but pointed the same way throughout; worth a fresh test. Holds, with the coins paid for: a write-up's word: it held up through every test, but only as set out: the coins bought outright, nothing borrowed. Not confirmed; the lead holds: a write-up's word: on fresh data it fell just short of the bar set in advance, but still pointed the same way.

13 Oct 2026 · Funding apart added: when Hyperliquid's funding runs above Binance's, does the price fall? From Hyperliquid's funding history back to May 2023. Its settings were fixed before any of its numbers were seen.

21 Oct 2026 · Correction: Binance's readings of 15 Oct 2026, 11:00 to 14:55 UTC, were wrong (frozen, halved or zero on every coin, in Binance's own archive too). They are now left out as missing, and the nine studies from the years were worked out again. No verdict changed. Some figures moved slightly, the most: #5's gap from 19.4 to 19.1 bps; #9 from 28 to 27 of 32 coins pointing the same way (the bar is 70%); #4's gap from +0.1 bps to about none. The "so far" figures on the new record moved more, as 15 Oct is one of its eight days.

Historical data: Binance Vision (data.binance.vision), used under CC BY-NC-SA 4.0 (creativecommons.org/licenses/by-nc-sa/4.0); what is drawn from it here is shared under the same licence.

Educational research from public market data; any trading discussed is paper, never real. Nothing here is advice. The full notice.