> ## Documentation Index
> Fetch the complete documentation index at: https://docs-staging.centuari.finance/llms.txt
> Use this file to discover all available pages before exploring further.

# Fee Structure

> Understanding fees and economics for liquidity providers

## Overview

Understanding the fee structure is crucial for LP profitability calculations.

## Protocol Fees

| Fee Type      | Amount           | Charged To |
| ------------- | ---------------- | ---------- |
| Interest Fee  | 0.1% of interest | Both sides |
| No Order Fee  | \$0              | -          |
| No Cancel Fee | \$0              | -          |
| No Gas Fee    | \$0              | Subsidized |

### Interest Fee Example

```
Lend position: $100,000 at 8% for 1 year
  Interest earned: $8,000
  Protocol fee: $8,000 × 0.1% = $8
  Net interest: $7,992

Borrow position: $100,000 at 7% for 1 year
  Interest paid: $7,000
  Protocol fee: $7,000 × 0.1% = $7
  Total cost: $7,007
```

## LP Economics

### Spread Required for Profit

```
Minimum profitable spread:

Protocol fee on lend: 0.1% of interest
Protocol fee on borrow: 0.1% of interest
Total fee overhead: ~0.2% of interest

At 8% APY:
  0.2% of 8% = 0.016% (1.6 bps)

Minimum spread to break even: ~2bps
Minimum spread for meaningful profit: 20-50bps
```

### Full P\&L Example

```
LP Activity (1 year):
  Lent: $100,000 at 8.5% APY
  Borrowed: $100,000 at 7.5% APY
  Spread: 100bps

Revenue:
  Interest received: $8,500

Costs:
  Interest paid: $7,500
  Protocol fee (lend): $8.50
  Protocol fee (borrow): $7.50
  Total costs: $7,516

Profit: $8,500 - $7,516 = $984

ROI: 0.98% on $100,000
```

## Capital Efficiency

### Collateral Requirements

For borrow side of LP:

| Collateral Asset | LTV | \$100k Borrow Needs |
| ---------------- | --- | ------------------- |
| ETH              | 80% | \$125,000 ETH       |
| USDC             | 90% | \$111,111 USDC      |
| Stablecoins mix  | 85% | \$117,647           |

### Total Capital Needed

```
To LP with $100,000 each side:

Lend side: $100,000 USDC
Borrow side: ~$125,000 collateral (at 80% LTV)

Total capital: ~$225,000 for $100k each side
Capital efficiency: ~45%
```

### Improving Efficiency

<Tabs>
  <Tab title="Use Stablecoin Collateral">
    ```
    With USDC collateral (90% LTV):
    Borrow side needs: $111,111
    Total capital: $211,111
    Efficiency: ~47%
    ```
  </Tab>

  <Tab title="One-Sided LP">
    ```
    Lend-only LP:
    Capital needed: $100,000
    Efficiency: 100%
    But: Only earn lend rate, no spread capture
    ```
  </Tab>
</Tabs>

## Fee Comparison

| Protocol        | Order Fee | Interest Fee | Gas       |
| --------------- | --------- | ------------ | --------- |
| Centuari        | 0%        | 0.1%         | Free      |
| Traditional DEX | 0.3%      | N/A          | User pays |
| Aave            | N/A       | 0.1% (flash) | User pays |

## Break-Even Analysis

```
Given:
  Protocol fee: 0.1% of interest
  Target ROI: 5% annually
  Capital: $200,000

Required gross spread:
  5% + (0.1% × avg rate) / utilization

At 80% utilization, 8% avg rate:
  5% + (0.08 × 0.1%) / 0.8
  = 5% + 0.01%
  ≈ 5.01%

But spread is applied to half capital:
  Need 10% gross spread on $100k = $10,000

Actual spread needed: ~100bps with 80% utilization
```

## Fee Optimization

<CardGroup cols={2}>
  <Card title="High Utilization" icon="gauge-high">
    More fills = more fee amortization
  </Card>

  <Card title="Longer Maturities" icon="calendar">
    Same flat fee, more interest time
  </Card>

  <Card title="Efficient Collateral" icon="coins">
    Use highest LTV assets for borrow side
  </Card>

  <Card title="Volume" icon="chart-line">
    Scale reduces relative overhead
  </Card>
</CardGroup>

## FAQs

<AccordionGroup>
  <Accordion title="Are there volume discounts?">
    Currently no volume-based fee tiers. All LPs pay same 0.1% rate.
  </Accordion>

  <Accordion title="Do failed orders cost anything?">
    No. Cancelled or expired orders have no fee.
  </Accordion>

  <Accordion title="Are LP incentives available?">
    See [Incentives](./incentives) for current LP reward programs.
  </Accordion>
</AccordionGroup>