Rates & Payments
Storage Providers must make a payment once a week back to the pool
Rates
The pool is currently charging 15% APR to Storage Providers for borrowing.
SPs should not default due to severe economic changes to the Filecoin network as a whole that are not controllable by the SP. Most SPs know that Filecoin's rewards are dropping quickly in the current network conditions, and the Pool will charge an equitable rate that aligns with Filecoin's dropping rewards.
In order to ensure SPs can afford their payments, the pool charges a rate that is meant to float with the network's reward / TiB. As the network's reward / TiB increases, the rates go up. As the network's reward / TiB decreases (like we're seeing over the last 8 or so months), the rate decreases. When rates change, all previously borrowed funds get applied at the new rate. So if an SP borrows funds at 16.2% today, and then next month the rate drops to 15.8%, the SP's existing loans are charged at the new rate.
Automation of rate adjustments
Automating certain parts of DeFi can come with unexpected side effects. The GLIF team is monitoring different approaches, anchor points, and frequencies to see which ones will be the stablest moving forward to automate without risk of volatility.
Unless there are drastic changes to the network's rewards between now and our automation of rates, the rates will stay at 16.2%. If there is another manual rate adjustment, it will only go down.
Weekly payments
Once a week, the SP is expected to make a payment back to the pool for the amount it owes.
The current 16.2% annual rate converts into roughly 0.3115% weekly rate. Here are some example borrow amounts alongside their weekly payment amount:
| Borrow amount | Weekly payment |
|---|---|
0 FIL | 0 FIL |
1000 FIL | 3.115 FIL |
100000 FIL | 311.5 FIL |
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