The mechanism
A perpetual future has no expiry, so exchanges use a periodic funding payment to keep its price tethered to spot. When funding is positive, longs pay shorts every few hours. Holding spot and shorting the perpetual in equal size removes directional exposure and leaves the funding stream.
Why it persists
Retail leverage in crypto is structurally long. Persistent positive funding is the price that long demand pays for leverage, and it has been paid for years — this is a cash-and-carry basis trade wearing modern clothes.
What actually kills it
Not the trade — the venue. Exchange insolvency, withdrawal freezes, socialised losses on the derivatives book, and liquidation of your short during a violent rally before the spot leg can be posted as margin. The risk is operational and counterparty-shaped, and it is not diversified away by running the same trade on one exchange in larger size.
The automation reality
Signal and execution automate almost completely. Margin management across two legs on two venues does not: it needs monitoring, transfer capability, and a plan for the hour when one venue halts withdrawals. That is where the residual human effort lives, and it is not optional.