💵Fulcrum Strategy Reward Calculation

Correlation of Utilization Rate & Borrow APR

USDC/USDT

• 0 - 80% Utilization Rate: Interest rates will grow linearly from 10% to 25%

• 80 - 100% Utilization Rate: Interest rates will experience a linear increase from 25% to 45%

SOL

• 0 - 90% Utilization Rate: Interest rates will grow linearly from 3% to 18%

• 90 - 100% Utilization Rate: Interest rates will experience a linear increase from to 18% to 23%

This two-tiered interest rate framework is established to guarantee a reliable income stream for lenders at varying levels of pool utilization.

The progressive increase in interest rates as utilization approaches its upper limit is a strategic measure to balance the attraction of lending capital with the sustainability of the financial ecosystem. Additionally, the base rate will be subject to a monthly review and discussion.

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Lending Vault Reward

The lending interest is corresponding to utilization rate & borrow APR, please refer to the example below.

Formula

$$LenderAPR = Borrow APR \times UR\times0.9$$

*0.9 is because a 10% fee from the interest returned to lenders will be shared to team

Example

Lending Pool Size: 1000 USDC

Borrower has $100 and leverage 10X, meaning $900 has been borrowed

So, Utilization Rate = 90%

Borrow APR = 30%

Lender APR = 30% * 90% = 27%

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Leverage Vault Reward

To calculate the yield for borrowers in a simplified manner, it also considers two steps:

1. Yield Determination: The yield paid to lenders is influenced by the JLP's APR from the previous 4 weeks.

2. Borrow APR: The borrow APR will be deducted

Formula

$$APR=A+L(A-X)$$

Where

A = Benchmark APR, the JLP APR from previous week

L = Leverage Multiple - 1

X = Borrow APR*

*Borrow APR varies according to the token utilization rate

Example

Bob has $1000 and chooses to leverage for 5X, while:

JLP APR = 65.45%

Borrow APR = 25%

Leverage Yield = 65.45% + 4(65.45% - 25%)
Leverage Yield = 227.25%

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It is imperative to note that interest rates are subject to weekly adjustments based on prevailing market conditions. For the latest APR updates, please consult the official website regularly.