Gate News message, April 26 — Fu Peng, newly appointed chief economist at Xinhuojituan, explained the underlying business model of Bitcoin perpetual contracts on social media, comparing it to traditional finance’s “deferred fees” or “overnight fees” used in precious metals and commodity spot trading.
Fu noted that historically, gold exchanges employed daily forced settlement and liquidation, with long and short positions paying deferred fees to each other. When retail traders held large high-leverage long positions, deferred fees became the exchange’s most stable and hidden revenue source. Today, Bitcoin spot platforms rely heavily on perpetual contracts, with funding rates settled between long and short positions every 8 hours. When longs dominate, retail traders holding long positions continuously pay funding rates to short positions.
While platforms do not directly collect these fees, the perpetual contract mechanism significantly boosts trading activity, open interest, and liquidity, indirectly generating substantial fee income and creating a stable, large cash flow. Essentially, the model functions as large holders and institutions “collecting rent” through long-term positions, retail traders paying fees for leveraged long exposure, and platforms indirectly extracting value.
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