Negative Yields

In order to minimise Maker runs on the protocol’s capital, we allocate negative yield among all Makers at all points in time in proportion to their bUSD. In particular, we use the value of Market Yield instead of Maker Capital here such that all Makers with expired terms accumulate a higher share of losses.

If a Maker decides to leave the protocol with a non-zero Impermanent Loss, then this (risk-weighted) loss proportion is deducted from their final payout figure, becoming a Realised Loss.


When a Maker’s leveraged loss exceeds the size of their initial deposit, a Maker may be ejected from the protocol and have their position closed. Any Bonded tokens, including incentives, remain with the protocol.

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