Lending
Astrolend’s lending model operates by allowing users to lend their crypto assets into a shared pool, which is then used to fund the borrowing needs of other users on the platform. Here's how it works:
Asset Pooling: When you lend your assets on Astrolend, you deposit them into an asset pool. This pool is a collective fund that borrowers can draw from.
Supported Assets: You can only lend tokens that Astrolend supports. The platform provides a list of these supported assets, ensuring that the assets you deposit are eligible for lending.
Interest Earnings: As a lender, you earn interest on the assets you supply. This interest is calculated based on the Annual Percentage Yield (APY), which varies depending on the specific asset you lend.
Interest Rate Mechanism: Astrolend uses a two-piece piecewise function to determine the interest rates for each asset. This means that the interest rate is divided into two segments, and the rate applied depends on the utilization of the asset pool. When the pool is underutilized, a lower interest rate applies, encouraging borrowing. As utilization increases, the interest rate rises, reflecting higher demand for the asset.
In essence, Astrolend’s model allows you to earn a passive income by lending your crypto assets, with interest rates that adjust dynamically based on market conditions and asset demand.
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