Fees

GlowSwap has zero fees on swaps and deposits. In contrast to traditional AMMs, GlowSwap liquidity providers earn interest on their liquidity from borrowers.

Since opening up an exclusive pool has computational overhead over future transactions, borrowers are required to pay two extra fees.

The first is a one time fee for opening the exclusive pool. This is referred to as the initialization fee.

The second is called a slot fee. This fee is added on top of the regular interest payments to cover the costs for keeping the exclusive pool open.

Initialization Fee Calculation

The initialization fee is calculated based on the number of exclusive CPMMs that exist and the current slot fee.

Initialization Fee = (Slot Fee Per Year) /365 * 30^(0.2+0.04*num_exclusive_cpmms)

Slot Fee Calculation

The slot fee is calculated as a percentage of the total amount of liquidity in the exclusive pool.

The equation for updating the fee when there are fewer than 20 exclusive CPMMs is:

slot_fee_per_year *= (1-(20 - num_exclusive_cpmms)*0.01)^(days)
min_slot_fee = source_cpmm_liquidity * interest_rate * 1 year / 5000
if slot_fee_per_year < min_slot_fee {
    slot_fee_per_year = min_slot_fee
}

The equation for updating the fee when there are more than 20 exclusive CPMMs is:

slot_fee_per_year *= (1+(num_exclusive_cpmms-20)*0.01)^(days)
min_slot_fee = source_cpmm_liquidity * interest_rate / 5000
if slot_fee_per_year < min_slot_fee {
    slot_fee_per_year = min_slot_fee
}