Fees

Liquidity Provider’s Income

There are 3 main types of income that liquidity providers can receive from Pangea's pool.

$$LP\_Fee = swap\_fee + flash\_fee + airdrop\_reward (rewards)$$

Liquidity providers receive these returns based on the size and price range of their liquidity positions.

Income Breakdown

1. swap Fee : Fees received from the swap amount when a swap occurs. Taken from the output token.

$$swap\_fee = swap\_output * \frac{pool\_fee\_rate}{1,000,000}$$

c.f.) 10% of the total swap fee goes to the protocol.

2. flash Fee : Fees received from flash transactions where borrowing and repaying assets within 1 transaction.

$$flash\_fee = borrowed\_amount * \frac{flash\_fee}{1,000,000}$$

c.f) The flash fee is calculated at the same rate as the pool fee rate per pool.

c.f.) 10% of the total flash fee goes to the protocol.

3. airdrop Reward : Airdrop rewards for liquidity providers in the pool. Provided together with swap fee rewards when claiming.

$$airdrop\_{per}\_{second} = \frac{airdrop\_amount}{86,400}$$

c.f) Distributed in proportion to the time and is distributed to the users who have provided liquidity to price ranges including the pool price at that time. Airdrop rewards start to be distributed every Thursday at 09:00(KST, UTC+9), and are distributed linearly for one week.

c.f.) No protocol fee is taken from airdrop rewards.

How to Calculate Estimated APR

Estimated APR is calculated by using the following formula to find the Estimated APR (APR_full range) for a full range position and then multiplying it by the Fee Boost.

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$$unitReward_0 = (swapFeeGrowthGlobal0_{now} - swapFeeGrowthGlobal0_{now-1D}) \cdot price_{0} \\ unitReward_1 = (swapFeeGrowthGlobal1_{now} - swapFeeGrowthGlobal1_{now-1D}) \cdot price_{1} \\unitAirdropReward_0 = airdrop\_{per}\_{second}_0 \cdot86,400 \cdot price_0 \\unitAirdropReward_1 = airdrop\_{per}\_{second}_0 \cdot 86,400 \cdot price_1$$

$$APR_{full\_range} =(unitReward_0 + unitReward_1 \\ +unitAirdropReward_0+unitAirdropReward_1) \cdot liquidity_{1 dollar} \cdot 365D$$

$$Estimated\_APR = APR_{full\_range} \cdot Fee Boost$$