To stay self-sustainable, the protocol takes fees for different operations.
If a Credit Account is liquidated, some percentage goes to a third-party liquidator who liquidated the account - and some percentage goes to Gearbox Protocol.
- Current liquidation fee going to the liquidator: 4%
- Current liquidation fee going to the protocol: 1.5%
The protocol takes spread as a fee between the APY which liquidity providers recieve and the fee & farmers pay for borrowing their assets. The exact value of this fee is calculated as following:
- Borrowers pay borrow APY to liquidity providers and pay spread fee to DAO spreadFee. That means effective borrow rate for borrowers is calculated as r(u)*(1+spreadFee). DAO receives r(u)*spreadFee.