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Trading Fees and Others

Trading Fees​

By default, Denaria applies two types of fees when trading:

  • Trade fee → A fixed percentage fee of 0.1% is charged on the notional value of every trade, both when opening and closing positions. This fee is collected in the quote asset (vStable).
  • Flat fee → A separate fee is applied to cover gas sponsorship costs. This fee ensures the protocol remains economically sustainable by offsetting blockchain interaction expenses. As of today, this fee is $0.12.

Trading Fee Breakdown and Distribution​

The protocol uses a flexible mechanism to define how fees are allocated. A configurable percentage ϕ of each fee is assigned to the protocol and Insurance fund, while the remaining (1 - ϕ) is distributed to liquidity providers.

As today, the ratio for the distribution of the fees is the following:

  • 50% to Liquidity Providers
  • 30% to Protocol
  • 20% to Insurance Fund. When cap, to Protocol

Other Fees​

  • Funding fee → A funding fee is paid or received based on market conditions. Please explore this topic in the dedicated section Funding Rate
  • Withdraw stable → Sending stablecoins out of the PWA incurs a flat fee of $0.12. This fee is used to cover blockchain transaction costs and prevent spam attacks.
  • Add/Remove collateral → Adding or removing collateral in a trade position incurs a flat fee of $0.12. This fee is used to cover blockchain transaction costs and prevent spam attacks.