Platform Fees
WeissFi provides a transparent fee structure to ensure users have full visibility into the costs associated with borrowing, repayments, liquidations, and redemptions. Below is a breakdown of all applicable fees.
Borrowing Fees
When drawing WEIS from a Trove, a one-time borrowing fee is charged on the borrowed amount and added to the borrower’s debt.
Borrowing Fee
0.75% fee on the borrowed amount.
Applied each time the borrower draws additional WEIS from their Trove.
Added directly to the debt, rather than deducted from the borrowed amount.
100% → Allocated to the WeissFi team for protocol sustainability.
Upfront Interest Payment
When opening a loan, borrowers must pay 7 days of interest upfront.
This interest is added to the debt at loan creation.
Each time the borrower modifies their interest rate, they must pay another 7 days of interest upfront to prevent abuse.
100% → Distributed to Earners in the Stability Pool.
Interest Rate (Ongoing Borrowing Cost)
Annual Interest Rate (User-Defined)
Borrowers set their own interest rate at loan creation.
Interest accrues over time and is added to the outstanding loan balance.
The higher the interest rate, the lower the redemption risk, but it increases the total cost of borrowing.
Interest Rate Modifications
Borrowers can modify their interest rate at any time.
Each time the interest rate is changed, 7 days of interest (based on the new rate) is immediately added to the debt.
This rule prevents manipulation of interest rates and ensures fair compensation for liquidity providers and lenders.
Interest Fee Distribution:
75% → Distributed to Earners in the Stability Pool.
25% → Allocated to the Liquidity Pool for liquidity providers.
Liquidation Fees
If a borrower’s Liquidation Price is reached, their collateral is liquidated to cover the debt.
Liquidation Conditions:
If a borrower's Loan-to-Value (LTV) exceeds 90%, their loan is automatically liquidated.
A 6% liquidation penalty is applied to the borrower’s collateral.
The borrower keeps the remaining collateral after liquidation.
Liquidation Fees Distribution:
85% → Distributed to Earners in the Stability Pool.
15% → Allocated to the WeissFi team for protocol sustainability.
Redemption Fees
Redemptions occur when WEIS trades below $1.
Redemption fees are based on the baseRate state variable, which is dynamically updated. The baseRate increases with each redemption, and exponentially decays according to time passed since the last redemption (half-life of 6 hours).
Redemption Fee: min (0.5% + baseRate, 100%)
The baseRate dynamically adjusts based on redemption demand.
Higher redemption demand increases the fee, while lower demand gradually reduces it over time.
Borrowers affected by redemptions do not lose value in USD terms, as their debt is reduced proportionally.
Summary
Borrowing Fee
0.75% on each WEIS draw, added to debt.
Upfront Interest Payment
7 days of interest paid upfront at loan creation and upon interest rate modification.
Ongoing Interest Rate
Set by the borrower, accrues over time.
Interest Rate Modifications
Each modification adds 7 days of interest to the debt.
Liquidation Penalty
6% of collateral taken if liquidation occurs.
Liquidation Fee Distribution
85% to Stability Pool, 15% to WeissFi team.
Redemption Fee
Minimum 0.5% + baseRate, dynamically adjusted based on demand.
WeissFi ensures full transparency and predictability, with no hidden costs. All fees are fixed, and borrowers remain in control of their interest rates.
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