skewScale of the futures markets as per the below (in dollar millions):
|Current Skew Scale||Propose Skew Scale||current 1h normalized funding||current dydx 1h funding|
skewScale determines the funding rate for a given level of skew, as per the function
maxFunding*skew/skewScale, raising the skewScale will result in a lower funding rate.
skewScale was recently lowered by a significant amount due to the state of the markets, resulting in extremely high funding. This was originally done due to the high volatility and consistent price movement in a single direction. This situation seems to have abated, leaving Kwenta futures traders exposed to extremely unfavorable funding rates, which concerned users have noted are 100x higher than competing exchanges, and which many users have expressed cause normal trading strategies to be impossible on Kwenta. This proposal returns these parameters to their state before sccp-202 to alleviate issues with the UX.
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