Increasing Stability Fee in Pando Leaf
We have been monitoring market conditions closely and have determined that a rate adjustment is necessary in order to maintain the stability and health of our stablecoin: pUSD.
on Aug 25, 2023, Pando Leaf will increase the stability fee
to mint pUSD against the range of the supported collaterals to better adjust to the market situations.
This decision has been made due to a number of factors, including the rising cost of capital in the market, particularly as a result of the global interest rate hikes.
The changes will affect on all the supported collaterals, from 8.5% to 11.5%.
What does this mean to you?
After the increase in the stability fee takes effect, borrowing pUSD will become more expensive. You will then need to be paying 11.5% annually on any pUSD you have borrowed instead of at the current rate.
Between now and then, you can pay down debt at the current lower rate if you do not want to continue with a 11.5% stability fee after the adjustment. Please be noted that if you choose not to repay your debt, the new stability fee will increase your accumulated debt balance and thus reducing your collateralization ratio and potentially putting your debt at higher risk of liquidation
. It’s advised that you check your debt’s collateralization ratio and make sure it will be in a safe range to avoid liquidation of your colleteral.
Getting help
If you experience any issues with your vault(s) or have any questions regarding using Pando Leaf, you can check our docs
for general understanding, post your questions in our communties.
