Interest Rate Model
borrowing rate of lending pools
Interest Model | Typicial Assets |
---|---|
Interest Rate Model 1: Borrowing rate applicable for assets with high market cap. | ETH USDC |
Interest Rate Model 2: Borrowing rate applicable for most assets. | VELO OP SNX |
Interest Rate Model 3: Borrowing rate applicable for Stable Pool & LST Pools. | USDC (for sAMM pools) DOLA FRAX USDR wstETH and other stable or LST assets |
Specifically, for stable and LST(Liquidity Staking Assets) pools, an interest rate model is introduced that aligns with the characteristics of 1) pegging and 2) a lower farming APY compared to volatile pools. This interest model functions similarly to a fixed borrowing rate mechanism before it hits a utilization threshold.
It's important to note that the 5% fixed borrowing rate in the chart below is not a static figure but rather subject to market conditions and borrowing demand. The parameter will be regularly reviewed and updated under a governance procedure.
Read more about the interest rate model here:
Pseudo-Fixed-Interest-Rate ModelLast updated