🤝Platform Fee Utilisation

Borrowers pay a platform fee of 10% of the total value of the interest to be paid for a loan. Platform fees are paid in the borrowed asset, and automatically deducted from the borrowed value. Fees are automatically paid when taking a loan.

For example, for a loan of $10,000 with a 10% interest rate, a total of $1,000 has to be paid in interest. So the borrower pays back $10,000 loan + $1,000 interest + $100 platform fees.

- 25% is shared with all $LUMIN stakers - 25% is allocated to the operation of the $LUMIN protocol

The remaining 50% of these fees are used by our buy-back mechanism. A market buy of $LUMIN tokens on the DEX, of which half are burned, and the other half is transferred to the borrower.

Platform fees are paid in the principal asset of the loan, and in this example for the $100 are distributed as follows:

- $25 (25%) is shared among all stakers, linearly distributed to staked share. The more someone stakes, the higher their share of these fees. - $25 (25%) is allocated to the operation of the $LUMIN protocol - $50 (50%) is swapped for $LUMIN tokens. Half of the $LUMIN tokens ($25 worth) are burned, the other half ($25 worth) are given to the borrower that paid the fees.

The $LUMIN tokens distributed to the borrower, are staked for 10 epochs (weeks).

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