💰Supplying & Earning

How to supply assets on Bonzo Finance

To start supplying assets on Bonzo Finance, navigate to the "Supply" section of the user interface. Select the asset you wish to supply and click on the "Supply" button. Enter the amount you want to provide and confirm the transaction. If this is your first time supplying a particular asset, you'll need to approve the transaction, which requires signing.

Once the transaction is confirmed, your supplied assets will start earning interest based on the current market conditions.

Understanding your earnings on Bonzo Finance

When you supply assets on Bonzo Finance, you receive bTokens, which represent your share of the liquidity pool. bToken holders earn a continuous stream of income that is influenced by two main factors:

• Loan interest payments: Suppliers receive a portion of the interest paid by borrowers, which is calculated based on the average borrow rate multiplied by the utilization rate. Higher utilization of a reserve leads to higher yields for suppliers. The specific borrow interest rate model will be made available before the Bonzo protocol launches on mainnet.

• Flash Loan fees: Suppliers also earn a share of the fees generated from Flash Loans, which amounts to 0.09% of the total Flash Loan volume.

Each asset on Bonzo Finance has its own supply and demand dynamics, resulting in a unique Annual Percentage Yield (APY) that changes over time. You can view the average annual rate for the past 30 days to get a sense of the rate's evolution, as well as more detailed data on each asset's reserve overview in the app's home section.

Minimum and maximum supply amounts

Bonzo Finance does not impose a minimum supply amount. However, it's essential to consider that for very small amounts, the transaction cost associated with the supply process may exceed the expected earnings. Keep this in mind when supplying low quantities of an asset.

Borrowing with stable and variable rates

No, you can only borrow using a stable or variable rate, if you switch to your desired rate it will switch the rate for your whole debt on that asset. Despite this, you can have different borrow rates for different assets.

How do I withdraw?

To withdraw your supplied assets, go to the "Dashboard" section of the Bonzo interface and click on "Withdraw." Choose the amount you wish to withdraw and confirm the transaction.

Please note that you can only withdraw if there is sufficient liquidity (i.e., assets not currently borrowed) in the pool. If there isn't enough liquidity, you'll need to wait for more suppliers to provide funds or for borrowers to repay their loans.

Opting out of using supplied assets as collateral

Bonzo Finance allows you to choose whether or not you want your supplied assets to be used as collateral. After supplying an asset, you can opt-out of using it as collateral by navigating to the "Supply" section within your dashboard. Simply toggle the "use as collateral" button for the specific asset you wish to exclude.

Keep in mind that you can still withdraw your assets without opting out of using them as collateral, provided that those funds are not actively being used to borrow and the withdrawal would not cause a liquidation on your loans.