Dynamic Pricing Model

Athenains.io aims to lower the costs of its products by incorporating features such as dynamic pricing models coupled with liquidity defragmentation.

The actual price of each cover product will be determined by the utilisation rate, from a base price to a maximum price when the utilisation rate is 100%. In other words:

  • When capital is available: low interest rate to encourage hedge purchases.

  • When capital is scarce: high interest rates to encourage additional supply.

By increasing available liquidity, the cost of coverage is optimized, this approach seeks to make coverage more accessible to users by reducing financial barriers and maximizing cost efficiency for participants in the DeFi ecosystem.

The price will be subject to Rslope1 until the optimal utilisation rate is reached. Once the optimum utilisation rate has been reached, the price will be subject to Rslope2.

Example: Annual base price of 1.4% and optimum utilisation defined at 75%. Before Uoptimal (red dot) the price is subject to Rslope1 (blue). After Uoptimal the price is subject to Rslope2 (green) and will increase more rapidly until it reaches its maximum. The maximum price will be reached when 100% of capacity is used.

The figures used in the example below are for illustrative purposes only. The actual parameters of each cover product may differ.

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