Hello all, I have a doubt: I borrowed busd long

Question

Hello all, I have a doubt: I borrowed busd long

time ago in kava.io, the interest fee was different at the time. Now it has changed; now my question is: I owe interest fees at the rate that was written at the time of borrowing (7 months ago) or does it fluctuate? It's confusing for me. Thanks

#blockchain #cryptocurrency #english #kava

0

22.02.2022

7 ответов

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Alessandro Автор вопроса

Cameron | Kava (I will never DM first)
Yes, interest fee can change because interest fees...

Not sure I understand, so that means that if I borrow busd to let's say buy a car, it's impossible for me to know how much I will pay in the end because interest fee can change anytime? Thanks for explaining further if you can. I appreciate

0

22.02.2022

Cameron | Kava (I will never DM first)

Alessandro
Not sure I understand, so that means that if I bor...

Lend is a money market. Yesterday, we saw a huge spike in BUSD's interest rate because a lot of supplied BUSD was borrowed and it went above 80% borrow limit utilization. But users supplied more BUSD to Lend and the interest fee went down.

0

22.02.2022

Alessandro Автор вопроса

Cameron | Kava (I will never DM first)
Lend is a money market. Yesterday, we saw a huge s...

Oh dear maybe my mind is too simple for Defi. I just want to know if the interest fee on what I borrowed long time ago is set in the interest fee that was 'advertised' at that moment or it changes overtime. Cause in that case I will just pay my debt. I don't like the idea of fluctuating interest fee on what I borrowed (I was thinking is something like a fixed-rate mortgage)

0

22.02.2022

Cameron | Kava (I will never DM first)

Alessandro
Oh dear maybe my mind is too simple for Defi. I ju...

The interest fees are never fixed on Lend. It changes from time to time, depending on how much assets are borrowed from Lend. Borrow APY increases by 5 percent for every 1 percent increase in utilization above 80%. If the borrow limit utilization stays below 80%, then the interest fees would stay remain low.

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22.02.2022

CryptoDaz (Darren)

Alessandro
Oh dear maybe my mind is too simple for Defi. I ju...

No, like Cameron has said the borrow fee is variable not fixed, so the amount you pay can vary greatly at certain times although the high apy we saw yesterday is usually short term and soon returns to a lower level. It's likely borrow rewards were in place when you first borrowed, these have been removed for the atom surge event, so kava mint is probably a better option currently

0

22.02.2022

Alessandro Автор вопроса

CryptoDaz (Darren)
No, like Cameron has said the borrow fee is variab...

Thank you for clarifying! I certainly was lucky and a bit too carefree! Not I love kava (and the whole Cosmos). I'll look into minting ;)

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22.02.2022

Cameron | Kava (I will never DM first) · Accepted Answer

Cameron | Kava (I will never DM first)

Yes, interest fee can change because interest fees aren't fixed on Lend. Interest rate model will be adjusted to increase Borrow APY by 5 percent for every 1 percent increase in utilization. As Borrow APY increases, so does the Supply APY. This incentivizes users to supply more of that asset which will in turn reduce the utilization and lower the Borrow APY.

0

22.02.2022

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Hello all, I have a doubt: I borrowed busd long

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