How Fees Are Calculated

Origami Protocol collects two types of fees

Protocol Fee:

Protocol Fee=totalSupply()annualFeePcttimeDeltaSinceLastCollection/365\boxed{\text{Protocol Fee} = totalSupply() * annualFeePct * timeDeltaSinceLastCollection / 365}

The Origami Protocol fee is collected periodically in the form of vault share token inflation in the vault. These new lov-Tokens will be minted periodically and dilutively to the Treasury. The default Protocol fee for most vaults will be 2% to 10% on an annualised basis but could be higher or lower depending on the expected yield in the vault. For the Fees Schedule applicable to a specific vault, check the Vault User Guides.

The Protocol fees accrue to the Origami Protocol Treasury and can be updated through governance

Dynamic Deposit / Exit Fee:

An instance of an economic attack could be a user who attempts to deposit into the vault when the share price was temporarily depressed due to the reserve asset being in a depegged state, and subsequently exit once the share price was restored.

To protect current vault shareholders from economic attacks stemming from transient depegging events, we utilise the concept of the Pessimistic Price Oracle to generate dynamic Deposit and Exit fees. These fees are sensitive to current market price volatility for the vault reserve token.

A Dynamic Deposit/Exit fee will be imposed if at the time of deposit or exit, the vault reserve token (collateral) spot price deviation from the reference price is greater than the threshold deviation. The price deviation from reference price is also multiplied by the LevFactor to account for the effect of leverage for that vault. These vault fees are imposed as a discount on the number of vault shares issued to the user at the time of deposit, or disregarded at the time of redemption. For the Fees Schedule for a specific vault, check the Vault User Guides.

Vault deposit and exit fees accrue as vault reserves to the users who are currently in the same vault and not to Origami Protocol Treasury.

When market price volatility is low for the underlying vault token:

A vault fee of not less than minDepositFeePercent will be assessed for User Deposits

A vault fee of not less than minExitFeePercent will be assessed for User Exits

When market price volatility is high for the underlying vault token:

The Vault deposit and exit fee may be significantly higher than the minimum. See Fee formula below:

Deposit Fee Formula

max(levFactormin(referencespot,0)/reference100,minDepositFeePercent)\boxed{max(levFactor*min(reference-spot, 0) / reference*100, minDepositFeePercent)}

Withdrawal Fee Formula

max(levFactormin(spotreference,0)/reference100,minExitFeePercent)\boxed{max(levFactor*min(spot-reference, 0)/reference*100, minExitFeePercent) }

Formula Terms Defined for the lov-sUSDe-a Vault:

spot=Oracle Price(sUSDe/DAI)spot = \text{Oracle Price}_{\text{(sUSDe/DAI)}}
reference=ShareToAsset(sUSDe/USDe)Oracle(USDe/DAI)reference = \text{ShareToAsset}_\text{(sUSDe/USDe)} * \text{Oracle}_\text{(USDe/DAI)}
levFactor = Vault Leverage + Safety BufferlevFactor\text{ = Vault Leverage + Safety Buffer}

For safety, LevFactor is set to a value that is higher than the actual leverage in the vault

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