Interest Rates and Calculation

How much does your assets earn?

  • Savings account interest rates
  • The calculation for these rates

Savings Account Interest Rate:

DeFiner uses market rates to determine the interest rate for each of our savings account assets (ETH, DAI, etc.) In short, lending rates determine the savings rates paid to our depositors. 

Rates are always changing just like asset prices are. That said, our commitment (and ability) is to always offer industry-leading rates. This is made possible as a matter of principle, and because we are a truly decentralized platform with less overhead than centralized crypto finance companies. 


Interest Calculation:  

Here is the formula for how we calculate our interest rates. The figures used are hypothetical.

Compound Supply Rate

Current compound Lend APR


Compound Borrow Rate

Current compound Borrow APR


Capital Reserve Ratio (R)

% of Remaining capital in the savings pool to total capital


Capital Compound Ratio (C)

% of capital in Compound to total capital


DeFiner Community Fund Ratio (D)

Fees charged for interests generated


Utilization Rate (U)

Loans Outstanding/Total Market Deposit


Loans Outstanding

The total value of loans borrowers have


Total Market Deposit

The total value of deposit lenders have


Borrow APR

Annualized Interest Rate for borrowing


Deposit APR

Annualized Interest Rate for lending


Borrow APR w/o Compound rate

Borrow APR calculation when the Compound rate is not available


DeFiner Community Fund Ratio (D)

Fees charged for interests generated and insurance



Utilization Rate & Interest Calculation

When money market is available:

  • Capital Reserve Ratio (R) is always between 10% - 20% (10%<=R<=20%),
  • Capital Reserve Ratio (R), Compound Reserve Ratio (C), and Utilization Rate (U) is always equals to one, (C+R+U=1); 


In this case, let's assume C=23%;


Then the calculation is: 

  • Borrow APR = (Compound Supply Rate + Compound Borrow Rate)/2 = (12%+18%)/2 =15%
  • Deposit APR = (Borrow APR * Utilization Rate (U) +  Compound Supply Rate * Capital Compound Ratio (C)  = 15%*67% + 12% * 23% = 12.81%

    When money market is not available:

    • Borrowing Interest Rate = 3% + U * 15% = 3% + 67% * 15% =13%
    • The utilization ratio U for each market a unifies supply and demand into a single variable:    U = Borrowsa / (Casha + Borrowsa). The demand curve is codified through governance and is expressed as a function of utilization.
    • For example, borrowing interest rates may resemble the following: Borrowing Interest Rate = 3% + U * 15%. The interest rate earned by suppliers is implicit, and it is equal to the borrowing interest rate multiplied by the utilization rate.



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