Binance Updates the Nth Term Formula for INTCUSDT and HOODUSDT Contracts with Interest Rate Set to Zero

Leading cryptocurrency exchange Binance has just announced a significant modification to the funding structure for two of its flagship perpetual contracts. Starting from 2026-02-03 16:15 (UTC), the interest rate component in the nth-term formula will be set to zero, marking a new chapter in the pricing mechanism for INTCUSDT and HOODUSDT.

Adjustment of Interest Rate Structure and Its Impact on Funding Rates

This policy is a strategic move by Binance to optimize the perpetual trading ecosystem. Previously, the funding rate consisted of two main elements: the interest rate component and the premium index component. With the interest rate set to zero, this structure undergoes a fundamental transformation.

It is important to note that although the interest rate has been eliminated, the funding rate can still fluctuate. However, now, these movements are entirely influenced by a single dominant factor: the premium index. This reflects Binance’s strategy to simplify the funding payment mechanism while maintaining healthy market dynamics.

Understanding the nth-term Formula and the New Calculation Mechanism

To better understand this change, it is essential to review the nth-term formula used in calculating the funding rate. The original formula is: Funding Rate (F) = [Average Premium Index (P) + clamp (interest rate - Premium Index (P), 0.05%, -0.05%)] / (8 / N)

With the interest rate set to zero, this nth-term formula is effectively simplified. The clamp component, which previously provided a buffer of ±0.05%, will now primarily depend on the difference between market conditions and the premium index. This change results in a more transparent and predictable structure for traders.

Access to Real-Time Data and Tools for Users

Binance offers several ways for users to monitor these changes in real-time. First, there is a dedicated page for Real-Time Funding Rate that provides live updates on current funding rates. Second, for users integrating APIs, Binance has added a new endpoint: GET /fapi/v1/fundingInfo, which allows programmatic querying of funding rate information.

With these tools, traders can make decisions based on the most accurate and up-to-date data. A deep understanding of how the nth-term formula operates will help optimize trading strategies in this new era.

Long-Term Significance of This Change

Binance’s normalization step reflects its ongoing commitment to adjusting products according to market needs. By simplifying the nth-term formula through the elimination of traditional interest rate components, the platform creates a more conducive environment for sophisticated and algorithm-driven trading.

The exchange actively encourages all users to stay ahead of these developments to optimize their trading positions. Comprehensive updates are available through Binance’s official communication channels.