We use Funding Base rate to calculate the Fair Price for a PrimeBit Perpetual Contract.
Here’s the formula:
Funding Basis = Funding Rate x (Time Until Funding / Funding Interval)
Fair Price = Spot Price x (1 + Funding Basis)
Funding Rate (FR) = Premium Index (P) + clamp(Interest Rate (I) - Premium Index (P), 0.05%, -0.05%)
Time Until Funding - time remaining until next Funding
Funding Interval = 3 (since funding occurs every 8 hours)
Spot Price - average last price from multiple external crypto exchanges