What it means
When perps trade above spot, longs usually pay shorts, and the other way round. Payments are often every 8 hours.
In practice
Funding keeps the perpetual price tied to spot: when perps are too expensive, longs pay shorts, which makes holding longs less attractive and pulls price back. Traders holding for days include it in their costs.
It is also read as a crowd gauge. Very high positive funding shows longs are crowded and vulnerable to a flush; very negative funding shows the same for shorts, which often comes before a squeeze.
What to watch for
Funding is charged on the full position size, not on your margin, so at high leverage it takes a noticeable share of your deposit every few hours. An extreme reading can also stay extreme for a long time in a strong trend.