Platform fees are charged for events within the Fringe Finance Platform. Events that may incur a fee include user interactions (such as taking out a loan) and some events do not involve a user interaction (such as interest being charged against a loan.)
Currently, fees are charged only as follows:
Even though fees are only charged as itemized above, Fringe may charge other fees in the future as needed to ensure the best balance of incentive-compatible participation in the Fringe ecosystem. The following table lists the possible fee events, who may be charged to and the basis of the fee.
Fees charged to users of the platform are not paid in FRIN tokens. This would result in a poor user experience, where users would have to first purchase FRIN tokens to use the platform. The Fringe Finance platform avoids this friction.
The denomination of fees charged to users of the platform are as follows:
- Portion of interest when repaying a borrow position: paid in the capital asset of the borrow position and accumulated into the Fringe Treasury.
- Portion of interest when repaying a trading position: effectively paid by the trader in the collateral asset used to secure the trading position, but swapped for the capital (short) asset and accumulated into the Fringe Treasury.
- Liquidation fees: paid in the liquidated collateral asset used to secure the borrow or trading position and paid to the liquidator.