Fees Manager

One place to get the current rate of any pool based on its rate settings.

Interface

interface IFeesManager {
    function setPoolRates(bytes32 _ratesAndType) external;
    function getCurrentRate(address _pool) external view returns (uint48);
}

One thing that is not immediately obvious is how the initial rates are passed into the contract. This is done in the setPoolRates method which accepts bytes32. Only two contracts can set the rates, PoolFactory on construction of the pool and the lending pool itself. To reduce the amount of variables passed to the factory on pool deployment we wrap them all into bytes32. Also if we ever need to pass additional variables to FeeManager we will not need to update the PoolFactory. Read more on this encoding here.

Fee Rates

All fee rates on Vendor are stored as uint48 with 4 decimals of precision. That meaning that 1% is stored as 1_0000 and 100% as 100_0000.

Terminology

Term Rate - aka effective rate is the rate that the borrower would be charged at the time of borrow.

APR - is the annualized term rate. Calculated by multiplying the term rate by the amount of such terms left in a year. Ex: if we have a pool with 1 month expiry and 1% term rate, then APR will be 12%.

Decoding _ratesAndType

Bytes Decoding for rates data.

Bytes	Name	Purpose
0-5	Auction End Rate	Rate at which the auction ends. Rate for any timestamp past the auction end rate will be equal to this value. Passed in hex.
6-11	Auction Start Rate	Rate at which the auction starts. Rate for any timestamp before the auction start rate will be equal to this value. Passed in hex.
12-17	Auction End Date	Time at which the auction decay rate will stop.
18-23	Auction Start Date	Time at which the auction decay rate will start.
24-30	Free Space	Can be used for passing more info if ever required.
31	Fee Type	Type of the fee rate behavior.

Encoding Function (TypeScript)

Here is the TS code you could use in order to obtain the bytes for desired configuration:

export function encodeFeeRates(rateType: number, startRate: number, endRate: number, auctionStartDate: number, auctionEndDate: number): string {
    let startRateComponent = ((startRate).toString(16)).padStart(12, "0");
    let endRateComponent = ((endRate).toString(16)).padStart(12, "0");
    let startDateComponent = ((auctionStartDate).toString(16)).padStart(12, "0");
    let endDateComponent = ((auctionEndDate).toString(16)).padStart(12, "0");
    let freeSpace = "0".repeat(14);
    if (rateType < 0 || rateType > 2) throw "Invalid fee type on encoding";
    let feeTypeComponent = (rateType).toString().padStart(2, "0");

    return `0x${feeTypeComponent}${freeSpace}${startDateComponent}${endDateComponent}${startRateComponent}${endRateComponent}`.toUpperCase();
}

Fee Types

There are different types of fee rate behaviors that the lenders can choose from. We might add more in the future, but here are the once that are currently supported:

Type	Encoding in bytes32
Fixed Rate	01
Linear Decay With Auction	02

Fixed Rate

With fixed rate lender chooses one flat term rate for the whole term of the loan. No matter at what time during the life of the pool will borrower try to borrow, borrower will be charged that flat rate. We need to pass the fixed rate in the auction start rate of the bytes32 variable.

Example:

Lender wants to set fixed rate of 5% for the whole term of the loan. In that case he would pass the following bytes:

0x010000000000000000000000000000000000000000000007A120000000000000

Here the 01 on the left stands for Fixed Rate and 7A12 in the position of auction start rate is the 50000 in hex.

Linear Decay With Auction

With this type of fee lenders can have a full control over how the fee rate for that pool decays. Here are some of the behaviors that are achievable. You can see the way an effective rate will behave in order to achieve different APR behavior as the loan progresses over time.

Some of the possible decaying rate configurations.

Examples

1) Let's start with a simple example and then extend it as we go. First use case for this type is to use it as a constant APR (first row of plots). This way the effective rate that the borrower would be charged on borrow will decrease as the remainder of the loan decreases approaching expiry, ensuring that when annualized, annualized rate or APR stays constant. In order to ensure such effect you will need to set the parameters in the following way:

Parameter	Value
Auction Start Date	Can be left blank.
Auction End Date	Can be left blank.
Auction Start Rate	APR user would like to use.
Auction End Rate	APR user would like to use. Same as start rate.

Here is an example byte32 that one would need to pass to make a pool with such rate behavior that starts on December 1st, expires on December 31st and holds the constant APR of 5%:

0x0200000000000000000000000000000000000000000000000007A12000000007A12

We will set both start and end rate to 5% or 500000 or 7A12. You can then completely disregard any dates and just leave them blank no matter when the pool starts or expires.

2) A second example is the case where the pool will start with a constant APR for some time, will then start an auction. Lastly it will keep the final constant APR after the auction end. Row 2 of the plots.

Parameter	Value
Auction Start Date	A date when lender would like the APR to start decaying.
Auction End Date	A date by which the APR decay should stop at the minimum allowed APR.
Auction Start Rate	The initial APR, will be maintained till the auction start.
Auction End Rate	The final APR, will be maintained after the auction end.

Here is an example byte32 that one would need to pass to make a pool with such rate behavior that starts on December 1st, expires on December 31st. It will hold the 10% APR for 7 days till December 8th, and then will lover it linearly to 5% till December 21st. It will hold 5% APR till expiry or December 31st.

0x020000000000000000000006391375E000063A25ADE0000000186A0000000007A12

Here the 6391375E represents the timestamp of the auction start in hex (December 8th). 63A25ADE represents the timestamp of auction end date or December 21st in hex. 186A0 is the auction start rate of 10% APR or 100000. Finally 7A12 is the 5% end rate or 50000.

Those are just two examples of how this mode could be used, but you could create more different configurations for how the rate will behave.