FAQ

Quick answers-links to the most frequently asked questions.

This section can help you find answers to the most common questions. The other answers you can likely find by reading the page names of the docs on the left, each section explaining the topics.

More complex and in-depth user questions are on the PRO Leverage Bible page.

• Where is the GEAR token contract and vestings? - here.

• Funding rounds and early backers? - at the bottom of the page here.

• Is the team anon? Who are DAO contributors? - at the bottom of the page here.

• What is GEAR token utility, can I stake it? - here.

• How does the DAO work and how to join an initiative? - here.

• How much capital does the treasury have and where does it go? - here.

• How to add new collateral / protocol? What is the framework? - here.

• What does Gearbox Protocol do? - bro, you are in the docs, read up <3

Do you feel like some question is missing? Send it on Discord!

- What fees am I paying?

Since Gearbox Protocol has two sides to it, the fees you are paying depend on what user type you are. If you are a passive lender, there is no fee. What you see is what you get, no added fees.

If you are a leverage user, you are paying a borrow interest fee (which fluctuates depending on utilization ratio) + Quotas which are also dynamic + liquidation fees to the protocol and a liquidator. The latter you pay only if you are liquidated. All fees are configurable by DAO, see Protocol Fees.

- What are dTokens like dUSDC and dWBTC?

Diesel Tokens are like cTokens of Compound. These tokens automatically earn interest & fees proportional to your share of the pool like cTokens on Compound or Yearn LP tokens. You don’t need to claim interest or perform any other actions, your Diesel Tokens value is supposed to grow.

V3, in order to give rewards to passive lenders, stakes those dTokens into the staking contracts, so you get sdTokens. The underlying doesn't change at all, it happens just so you get rewards.

- Will my APY for supplying liquidity go down or up?

The APY is variable and depends on the utilization ratio formula which is configurable by DAO. It also depends on Quota Rates. The interface makes it all simple, details can be found in Protocol Fees.

- What is a Health Factor and what can I do with it?

Health Factor is a numeric representation of your account's health. If your health factor drops below 1 or close to it, you might be liquidated. The higher the number is, the safer you are. Since liquidations make you incur higher fees, make sure to follow tips on how to not get liquidated.

- Сan I always withdraw liquidity?

Conceptually, yes.

Depending on the utilization ratio of pools though, if it is high - not all the liquidity can be withdrawn at once. It doesn't mean that the protocol lost money or is insolvent - it's just that the liquidity is utilized in Credit Accounts. In such cases where available liquidity is low (which you can check in the app analytics page per pool) - the APY goes higher as to attract more capital providers and attempt to find an equilibrium. This is more or less standard among all lending-type protocols and has happened both in Compound & Aave before. Gearbox DAO can adjust the utilization curve parameters to force certain behavior of the protocol in case weird situations occur.

- Why can't I borrow more?

As the protocol has max leverage and max personal borrow parameters, which are configurable by DAO, there is a limited amount you can borrow for leverage. As such, borrowing above that amount is technically not possible. Once a Credit Account is open, you can add more collateral to increase your position size and Health Factor, but you can't borrow to infinity for security purposes.

Those shall be updated every now and then after voting, in Credit Accounts.

- Will Gearbox Protocol be on other chains/L2/rollups/EVM-compatible?

Gearbox Protocol is DAO-operated, so it should be a joint community decision. That's one. If users need Gearbox - it's fine to deploy anywhere, because we have user-first approach.

- Why does a trade even from stable to stable decrease my HF (health factor)?

Due to how Threshold Weighted Values are calculated taking into account a possible price drop and a price feed tick, a stablecoin is not actually a stablecoin for the protocol contracts. They are not 1:1. Stablecoins tend to de-peg, which must be taken into account. This keeps the protocol more secure, but also causes max leverage parameter to be lower. As such, this is up to the risk appetite of Gearbox DAO to decide on such things. Check PRO Leverage Bible for more context.