Interest Protocol uses a fee revenue model. The more TVL and volume the protocol facilitates, the more fees it collects.
Every time a user swaps tokenA for tokenB, our DEX charges a trading fee in LP tokens depending on the type of market:
- Volatile Pair: 0.3% of the trading amount
- Stable Pair: 0.05% of the trading amount
4/5 of the trading fee is rewarded to the liquidity providers for their service. The remaining fee is collected by our treasury.
Our lending market accepts Interest Protocol LP tokens as collateral. This incentivizes people to provide liquidity to our DEX to leverage their positions at no cost. This results in having highly liquid markets, which attracts traders due to the low slippage when trading.
Our Dinero lending markets charge an annual interest rate fee in Dinero based on the risk profile of the collateral asset. The more Dinero users borrow, the more we earn. Our lending markets leverage third-party DeFi protocols such as Venus, Interest Protocol DEX ,and PancakeSwap farms to provide rewards to the user while he/she is borrowing.
The markets charge a lower interest rate than the reward rate. This is very attractive because it allows users to leverage their position for free.
Every time a user transfers a synthetic asset, he incurs a transfer fee. The creators of the synthetic asset receive 90% of the transfer fee. The treasury gets the remaining 10%.