Interest Rates

Interest Rates

Users with a positive balance of the base asset earn interest, denominated in the base asset, based on a supply rate model; users with a negative balance pay interest based on a borrow rate model. These are separate interest rate models, and set by governance.

The supply and borrow interest rates are a function of the utilization rate of the base asset. Each model includes a utilization rate “kink” - above this point the interest rate increases more rapidly. Interest accrues every second using the block timestamp.

Collateral assets do not earn or pay interest.