Rates and Fees

An overview of Alkemi Earn's interest rate models.

Interest Rates

Determining Factors

Supply and Demand

Interest rates for both borrowing and lending are calculated based on a single dynamic variable reflecting the current supply and demand for each liquidity pool on the market. When liquidity is low, interest rates increase algorithmically to incentivize lenders to inject more liquidity into the pool. When liquidity is high, interest rates are reduced algorithmically to provide attractive and competitive rates to borrowers.

Current Rates by Asset

USDC & DAI
BTC
ETH
USDC & DAI

Utilization

6.7%

13.3%

20%

40%

60%

80%

86.7%

93.3%

Borrow Rate

1.33%

1.67%

2.00%

2.67%

3.33%

4.00%

12.67%

21.33%

Lend Rate

0.09%

0.22%

0.40%

1.06%

1.98%

3.17%

10.87%

19.71%

BTC

Utilization

0.7%

1.3%

2.0%

28%

54%

80%

80.67%

93.3%

Borrow Rate

1.5%

2.0%

2.5%

11.67%

20.83%

30%

36.67%

43.33%

Lend Rate

0.01%

0.03%

0.05%

3.23%

11.14%

23.76%

31.36%

40.04%

ETH

Utilization

0.7%

1.3%

2.0%

28%

54%

80%

80.67%

93.3%

Borrow Rate

1.5%

2.0%

2.5%

11.67%

20.83%

30%

36.67%

43.33%

Lend Rate

0.02%

0.05%

0.10%

1.55%

4.42%

8.71%

14.87%

21.87%

Healthy Utilization Rates Table

‚Äč

USDC & DAI

BTC

ETH

Min Rate (0% UR)

1.00%

1.00%

1.00%

Healthy Min UR

20.00%

2.00%

4.00%

Healthy Min Rate

2.00%

2.50%

2.50%

Healthy Max UR

80.00%

80.00%

80.00%

Healthy Max Rate

4.00%

30.00%

11.00%

Max Rate (100% UR)

30.00%

50.00%

30.00%

Exchange Rates

Earn uses a decentralized price oracle, ChainLink, to calculate current mid-market rates between assets on the protocol. Exchange rates between currencies are prone to volatility.

Fees and commissions

All transactions on the Ethereum network incur gas fees. Users can choose to pay more or less gas according to their need for fast transaction processing.

Borrowing also incurs origination fees amounting to 0.1% of the borrow size. This amount is added to the balance owed.