How a lending pool sets your rate
Utilization, the borrowed share of a pool, drives every rate.
The rate model, hands on
Rates move with every supply, borrow, repayment and withdrawal.
At this utilization · 79.00%
- Borrowers pay
- 6.08%
- per year on 7,900
- Lenders earn
- 4.32%
- per year on 10,000
- Protocol keeps
- 10.00%
- ≈ 48 a year
Below optimal: borrowing is cheap and withdrawals leave freely.
Example: 10,000 tokens supplied
Start from
Utilization
79.00%Borrowed ÷ supplied
Optimal utilization
85.00%Where the curve bends
Base rate
0.50%Borrow rate at 0% utilization
Slope below optimal
6.00%Up to the optimal point
Slope above optimal
75.00%From the optimal point to 100%
Reserve factor
10.00%The protocol's share of interest
Share tokens: same count, rising value
Interest never mints new tokens; it raises the exchange rate.
- 1Jul 8, 2026You supply 8,000 tUSDC at 1 ym-tUSDC = 1.0326 tUSDC
- 2You receive7,747.46 ym-tUSDC
- 3Sep 29, 2026The rate reached 1.0412, so the same shares redeem for 8,066.66 tUSDC
The withdrawal queue
A pool pays out only what isn't lent. The rest waits in line, oldest first, and keeps earning.
1Your request
2Borrowers repay
3Paid from the queue
Glossary
- Utilization
- Borrowed ÷ supplied. 80% means four fifths is lent out.
- APY / APR
- Yearly rates: lenders earn APY, borrowers pay APR.
- Optimal utilization (kink)
- Where the rate curve bends and gets steep.
- Reserve factor
- The protocol's share of interest, kept as a buffer.
- Available liquidity
- Tokens not lent out, withdrawable now.
- Token approval
- A one-time signature letting the pool move a token.
The lender's view of the Monark DeFi demos
Same test tokens and prices across all four.