Strategies — Lending

Q: What are Lending Vaults?
Lending vaults are where all assets from lenders are pooled together. For example, all BTC deposited by lenders is combined in a single BTC lending vault, and borrowers can take loans directly from that shared pool.

You can access them here: rujira.network/strategies?filters=GhostVault

Q: What happens to the assets that I lend out?
Your assets are added to the lending vault and combined with those from other lenders. When someone borrows that token, it comes from this shared vault, and the interest paid is split pro-rata among all lenders.

Q: Can I always withdraw my assets?
You can withdraw your assets as long as they are not currently borrowed. If most of the vault’s assets are being borrowed (high utilization rate*), you may need to wait until some borrowers repay or new lenders add more liquidity.

*Utilization rate: the percentage of total deposited assets that are currently borrowed.

Q: How is the lending rate determined?
The lending rate depends on the utilization rate:

• When more of an asset is borrowed, or when some lenders withdraw from the vault, the rate goes up.
• When borrowing demand is low, or when more lenders deposit into the vault, the rate goes down.

This market driven mechanism helps balance supply and demand and keep interest rates in line with the broader DeFi market, attracting borrowers when there is an excess supply and rates are low, and attracting lenders when there is an excess demand and rates are high.