Fees in the Bluejay Earn protocol is calculated in a simple manner.
The protocol charges an
Origination Feeupon the successful funding of a loan pool.
The protocol has a tiered approach for charging fees based on the type of assets used for the loan.
Loan pools which uses Bluejay Stablecoins (aka bluStables) do not incur any fees upon successful funding.
Loan pools using any other assets (ie USDC, agEUR, xSGD, etc) will incur 10 basis points of fees.
Fees are charged to the borrower when they drawdown from the loan.
Ie. A borrower who raised 1M USDC from the pool will pay 1,000 USDC to the protocol upon successful funding. The principal of the loan will hence be set to 999,000 USDC.
A loan pool is deemed to be successfully funded when:
- The pool has raised assets greater than the minimum funding required by the borrower, and
- The borrower has drawndown on the loan before the drawdown period ends.
As such, the fees are not applied in the following scenarios:
- When a pool has met not met the minimum funding by the funding end time.
- When a pool has met the minimum funding but the borrower did not manage to drawdown in time.
In both of such scenario, the investors will be refunded in full.