Withdrawal Fee

Withdrawal Arbitrage” is able to drain fund from the pool and is harmful to the protocol’s long term financial health. To counter the attacks, there is a custom withdrawal fees mechanism.

In most cases, however, a very small withdrawal fee is already sufficient to prevent such an attack.

Assume the withdrawal amount is equal to 1% of the pool:

Cov RatioWithdrawal Fee

>= 1










You can learn more about withdrawal arbitrage and the design on withdrawal fee here.

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