Polymarket Perps fees, funding rates, and liquidation explained

Polymarket Perps launched on April 21, 2026 with a derivatives mechanics surface that's familiar to anyone who has traded on Binance, Hyperliquid, or dYdX. This guide walks through the three cost levers — taker/maker fees, funding rates, and liquidation — and explains how to model total cost of carry.

The three costs of holding a perp

Cost	When you pay it	Magnitude
Taker/maker fees	Each trade (open, close, partial fills)	0.01%–0.10% of notional, typically
Funding payments	Each funding interval (1h to 8h)	-0.10% to +0.10% per interval, annualised hundreds of %
Liquidation penalty	If position is forcibly closed	0.5% to 5% of notional + remaining collateral

For short-duration trades, fees dominate. For long-duration carry trades, funding dominates. For aggressive leverage, liquidation tail risk dominates.

Taker and maker fees

Polymarket Perps follows the standard CLOB fee model:

• Taker fees: paid when you cross the spread (market orders, immediate-or-cancel orders that match against the book).
• Maker fees: paid (or rebated) when you post liquidity that another trader fills (limit orders that rest on the book).

As of launch, Polymarket has not published a final fee schedule. Industry comparable benchmarks:

• Hyperliquid: 0.025% taker / 0.015% maker.
• Binance Futures: 0.045% taker / 0.018% maker.
• Coinbase International: 0.06% taker / 0.04% maker.

Polymarket's prediction-market fee schedule (0%–1.8% taker, 0% maker) is more aggressive than the perp competitor set, but perps fees will likely be in line with the DEX-perp benchmarks rather than the prediction-market schedule.

Funding rates

Funding rates are the mechanism that keeps a perpetual futures price anchored to the spot price of the underlying asset. The formula is:

funding_rate = (perp_mark_price - spot_index_price) / spot_index_price * dampening_factor

If the perp trades above spot (longs are bidding it up), funding is positive — longs pay shorts. If the perp trades below spot, funding is negative — shorts pay longs.

The funding payment per interval is:

funding_payment = position_notional * funding_rate

For a $1,000 long position with funding of +0.01% (1 basis point) per 8 hours, you pay $0.10 every 8 hours, or $1.10/day, or $401/year — annualised 40% on the notional.

Funding rates can be much larger on volatile pairs. Historically, BTC perpetual funding has reached +/-0.30% per 8 hours during squeeze events, equivalent to +/-3,285% annualised.

Liquidation

Liquidation happens when your position's mark-to-market loss approaches your initial collateral. The liquidation price formula for a long position is approximately:

liquidation_price ≈ entry_price * (1 - 1/leverage * (1 - maintenance_margin_pct))

For a 10x long entered at $100,000:

• Without maintenance margin: liquidates at $90,000 (a 10% drop).
• With 0.5% maintenance margin: liquidates at $90,500 (a 9.5% drop).

For a 100x long: liquidates at ~$99,000 (a 1% drop). Add a tiny maintenance buffer and it's even less.

When you're liquidated, the venue closes your position at (or near) the liquidation price and keeps the remaining collateral as a penalty. Polymarket's exact liquidation penalty schedule was not published at launch.

Insurance fund

To protect against socialised loss, perp venues maintain an insurance fund seeded by liquidation penalties and (sometimes) by venue capital. When a position liquidates faster than the venue can close it on the order book (a "skid" event), the insurance fund covers the deficit.

If the insurance fund runs out, the venue typically socialises losses across profitable counterparties — a process called Auto-Deleveraging (ADL). ADL is rare on mature venues but happens during extreme volatility.

Polymarket has not published the size or mechanics of the perps insurance fund. Industry comparable benchmarks: Hyperliquid maintains a multi-million-USDC insurance fund publicly visible on its dashboard.

Modelling cost of carry

To model the true cost of holding a Polymarket Perps position for T days, use:

total_cost = entry_fee + exit_fee + (T * 24 / funding_interval_hours) * |avg_funding| * notional

Example: $1,000 notional, BTC perp, holding 30 days, average funding +0.01%/8h, taker fee 0.05% each side:

• Entry fee: 0.05% * $1,000 = $0.50
• Exit fee: 0.05% * $1,000 = $0.50
• Funding payments: 30 * 3 * 0.01% * $1,000 = $9.00
• Total cost: $10.00, or 1.0% of notional.

For longer holds, funding dominates. For shorter trades, fees dominate.

Reducing your cost of carry

• Use limit orders for entry and exit. Maker fees are typically half taker fees.
• Hold positions for shorter durations. Funding compounds.
• If funding is consistently against you on your direction, consider an offsetting position on a venue with negative funding (the funding-rate arbitrage strategy).
• Avoid extreme leverage. Liquidation cost dwarfs the trade-fee savings of running with thin margin.

Frequently asked questions

What's the minimum funding interval on Polymarket Perps?

Not yet disclosed. Industry standards range from 1 hour (Hyperliquid) to 8 hours (Binance, Coinbase). Polymarket Perps will likely fall in this range.

Are Polymarket Perps fees deductible for tax purposes?

Treatment varies by jurisdiction. In most jurisdictions, perp trading fees are deductible from realised PnL. Consult a tax advisor.

Can Polymarket Perps go into Auto-Deleveraging?

If the insurance fund is depleted and a position cannot be liquidated cleanly, ADL is theoretically possible. Polymarket has not published the exact ADL mechanics for perps; we will update this guide when they do.

What happens to funding payments I receive while I'm long?

They accrue to your position's PnL automatically. You don't have to claim them. They show up in the Positions tab as Cumulative Funding.

Can I see real-time funding rates before opening a position?

Yes — the asset page on the Polymarket Perps interface displays the current funding rate alongside the mark price and 24h volume.