Below is a description of the current fees in the Sovryn system. All fees are controlled by the governance mechanism and subject to change. These fees are in addition to gas paid to transact on the Rootstock network.
¶ Zero Borrowing
¶ Fees on Borrowing
Zero charges no interest on borrowing. An upfront origination fee of between 5% and 10% is charged (0% during recovery mode when the system collateral ratio falls below 150%). The rate varies depending on redemption activity, increasing when redemptions occur and settling down to 5% when they don't.
¶ Fees on Redemption
Redemption is not the same as paying back the loan. Borrowers can pay down their loan for free at any time. Redemptions occur when someone trades their ZUSD for the equivalent nominal amount of RBTC. Redemption fees are the same as borrowing fees (1.9% minimum) except there is no cap.
¶ Trading
¶ Fees collected by LPs
Liquidity Providers can provide funds to the Sovryn AMM in return for a share of the fees generated through swaps in a given pool.
Pools where users must provide liquidity to both sides of the pool (v1 pools) charge a swap fee of 0.35%. The swap fee is split between AMM Liquidity Providers and the FeeSharing Proxy contract (the smart contract responsible for holding fees until stakers withdraw them).
- The split is: 0.25% to LPs / 0.1% to Fee Proxy (for stakers).
Unlike most other AMMs, such as Uniswap, some pools do not require deposits to both sides of the pool. For these pools, LPs can add only one or both of the tokens (v2 pools). The fee on these pools are currently set to 0.1%, which is also solely distributed to LPs.
LPs also earn 0.1% of every margin trade performed.
¶ Fees collected by the Sovryn Protocol
The Sovryn protocol collects a fee on each margin trade that is performed. This fee is currently set to: 0.15%. A 0.09% fee on loan origination and a 10% fee on interest repayments is also collected by the protocol, to be distributed to SOV Bitocracy stakers.
¶ Lending and Borrowing
¶ Fees on Borrowing
The interest rate paid by borrowers to lenders (APR) is set dynamically based on supply and demand - the ratio of supply to loans. It can range from 1% to 100%.
The Sovryn protocol collects an origination fee on every loan, currently set to 0.09%
¶ Liquidity Mining
In addition to the fees collected by the Sovryn system, users will benefit from the ability to earn SOV tokens through Liquidity Mining. 45% of SOV tokens will be distributed this way.
¶ MYNT Bonding Curve
¶ Fees collected by Sovryn Exchequer
On behalf of the Sovryn Treasury, Sovryn Exchequer collects a fee on every SELL order (MYNT to SOV conversion) placed using the MYNT Bonding Curve. The SELL fee is currently set to 0.3%.
¶ Summary of Fees
| Collected by Sovryn | Collected by Lenders | Collected by LPs | |
| Zero Origination | 5% to 10% | ||
| Zero Redemption | ≥1.9% | ||
| Trades | 0.15% | 0.1% | |
| Swaps (v1) | 0.10% | 0.25% | |
| Swaps (v2) | 0.1% | ||
| Loan Origination | 0.09% | ||
| Loan Interest | 10% | 90% | |
| MYNT Bonding Curve Sell Orders | 0.3% (to Sovryn Exchequer) |