Protocol fees

What are the protocol fees?

There are currently 6 distinct protocol fees :

• Revenue : 1% upfront fee on Perpetual loan value

• Revenue : 0.5% fee on Bond loan value

• Revenue : 15% fee on Perpetual loan borrow rate (see below)

• Revenue : 20% fee on Flip loan borrow rate (see below)

• Revenue : 10% penalty fee on loans entering the 12h Grace Period

• Reserve : 30% reserve factor on Perpetual loan borrow rate (see below)

Interest distribution for Perpetual Loans

Reserve factor and ecosystem reserves

The 30% reserve factor for Perpetual loans and Isolated lending pools is a safety mechanism that is progressively fueling the ecosystem reserves. These reserves are being accumulated and stored in case of bad debt or any black swan event happening so the protocol can repay lenders in such cases

Interest distribution for Flip Loans