When the funding rate hits an extreme, I start to get suspicious: should I take the other side and eat that profit, or just play it safe and avoid the volatility? Honestly, the funding rate is like a thermometer of market sentiment; the hotter it gets, the more likely it is to break through the needle. If I do take the other side, it’s not like going all-in; I usually check the slippage and routing first, so I don’t get MEV-sniped before I even collect the fee… Then I only take small positions, split into batches, and if I can’t handle it, I admit defeat and walk away.

It’s not shameful to avoid the other side either, especially lately with various new L1/L2s offering incentives to boost TVL. Veteran users complain that it feels like “mining and selling,” and the liquidity heats up and cools down, causing the fee rate to fluctuate wildly. Jumping in too quickly can easily turn into providing exit liquidity for others.

I still believe: as long as the market keeps noisy, paying attention to details (slippage/execution/risk control) can still save some tuition fees. That’s all for now.