Ethos Reserve
  • Introduction
    • General Information
    • Accessing Ethos & Optimism
  • How to use ethos reserve
    • Navigating Ethos Dashboard
    • Minting $ERN
    • Earning Yield & stERN
    • Managing Your Position
    • Bonded OATH & Staking
  • Understanding ethos reserve
    • Definitions
    • Understanding $ERN
    • Zero-Interest Lending
    • The Stability Pool
    • How Liquidations Work
    • How Redemptions Work
    • Recovery Mode & Relevant Ratios
    • The Analytics Page
  • Ethos Reserve Contracts
  • Audits
  • Contact Us
  • Disclaimer
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  1. Understanding ethos reserve

Zero-Interest Lending

PreviousUnderstanding $ERNNextThe Stability Pool

Last updated 1 year ago

Ethos Reserve issues interest-free loans denominated in the $ERN stablecoin. Instead of paying interest, users pay a small issuance fee, meaning they don’t need to worry about micro-managing their position. The issuance fee usually sits around 0.5%, but it varies slightly depending on the state of redemptions. Learn more about redemptions in .

There is no fee for paying back a loan.

ERN Loan Example

  • If a user deposits sufficient collateral, they can take out a 100 ERN loan.

  • Their total debt will appear as 110.5 ERN, which is made up of a 0.5% issuance fee (in this case 0.5 ERN), 10 ERN held as a liquidation deposit, and 100 ERN minted to the user’s wallet.

  • When the user pays back 100.5 ERN, the 10 ERN liquidation deposit will automatically be paid into their position and the position will be closed.

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