LP Fee Earnings

LPs earn fees from two sources.

1. Position open fees — 3% of notional

Every time a trader opens a long or short, 3% of the USDC notional is added to lpFeesAccumulated. The LP can claim these at any time via claimFees().

openFee = usdcAmount * 5 / 100
lpShare = openFee * 3 / 5    // 3% of notional

Fees accumulate in USDC and are claimed in a single transaction.

2. Swap fees — passive yield

The configurable swap fee (default 1%) stays in the pool on every swap. This implicitly increases the LP's backed reserves over time — it's not claimed separately, it's reflected in larger withdrawal amounts.

Claiming fees

Call claimFees() on the pool. The accumulated USDC is transferred to the LP NFT holder and lpFeesAccumulated resets to zero.

Only the current LP NFT holder can claim.

Revenue model

LP earnings scale with:

• Number of positions opened — more opens = more 3% fees
• Swap volume — more swaps = more passive yield
• Pool TVL — larger pools attract more traders
• Position size — bigger positions = bigger fees

TIP

LPs can use position caps to manage risk while still earning fees on smaller positions.