Interest Rate Model 1

Interest Rate Model 1 governs USDC only.



Stablecoin liquidity is the most important type of asset for any money market to operate properly. The most trusted stablecoin in crypto remains USDC, which is why USDC has its own interest rate model. This interest rate model specifically tailored to encourage participants to use leverage, but also attract and maintain deep liquidity.


To keep USDC markets at Lodestar very liquid, interest rates parameters governing USDC are extremely competitive with other money markets. USDC suppliers will find that at every level of utilization they will enjoy rates that exceed those provided by other leading DeFi protocols.


The rates paid by borrowers are slightly higher to compensate for this. This reflects the exposure to higher risk assets suppliers are assuming compared to other leading DeFi protocols.


Lodestar's aim is to create a money market that serves the vibrant yield opportunities native to Arbitrum, and stablecoin liquidity is paramount to achieving this goal. Stablecoin providers will be equipped with new and dynamic strategies in Lodestar V1.

See the Roadmap for more details.

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