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INTEREST_MATH.md

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Interest Math for Club Pools

This document explains how interest is handled in the club pools.

Overview

  • All stakes are immediately supplied into Aave to earn yields
  • A member MUST complete runs and finish the season to earn the interest
  • Interest rate is distributed proportionally to members after the season ends

Stake Deposit and Withdrawal

  • During a deposit, USDC is supplied to Aave to earn interest
    • The totalStake amount is updated to checkpoint the total USDC supplied (w/o interest)
  • During a withdraw, USDC is withdrawn from Aave and interest is realized as USDC
    • The totalStake - USDC.balanceOf(this) = interest earned for the pool
    • This interest earned is claimed by users on withdraw by proportional distribution to each member
      • i.e. userInterest = interestEarned / finalMemberCount
      • withdraw amount = userStake + userInterest