Recently, a major exchange launched an interesting contract update — the funding rate settlement can automatically switch from "hourly" to "every four hours."

How does it work exactly?

The rule is straightforward: If the funding rate for a USDT perpetual contract remains particularly low (absolute value ≤ 0.025%) for 16 consecutive hours, then at the 17th hour, the settlement frequency automatically changes from hourly to four-hourly. However, if at any point during these 16 hours the rate suddenly spikes (>0.025%), the switch is canceled, and the original hourly settlement continues.

Taking the ZKPUSDT contract as an example: If from 5 AM on January 2nd until 8 PM, the rate stays low, then around 8:15 PM, its settlement mode will automatically switch.

What does this mean for you?

If you hold a position, fewer settlements directly mean lower friction costs. The reduced frequency of funding payments can save you some money in a low-volatility market. More deeply, sustained low funding rates are a signal — indicating that the market sentiment for this contract is balanced between bulls and bears, with no strong directional expectation. The exchange introducing this mechanism is like adding a "power-saving mode" to inactive contract markets.

In other words, when the market is active and the battle between bulls and bears is intense, frequent hourly adjustments of the funding rate are necessary to balance supply and demand; when the market calms down, there's no need for such frequent settlements, and four-hourly is sufficient.

This rule is automatically triggered, so you don't need to operate manually, and it only affects those contracts that remain stable over time. If you notice a contract with long-term low rates, keep an eye on it — this often indicates the market is in a consolidation phase with less volatility and unclear direction.