> For the complete documentation index, see [llms.txt](https://docs.syndromics.xyz/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.syndromics.xyz/resources/business-model.md).

# Business model

Syndromics earns small, explicit fees on the value it creates: origination, interest, liquidation and refinancing. There is no token, no emissions and no spread hidden in the rate.

## Revenue streams

| Stream                         | Rate (initial)            | Paid by                                      |
| ------------------------------ | ------------------------- | -------------------------------------------- |
| Origination fee                | 0.25% of principal        | Borrower                                     |
| Interest share                 | 10% of interest paid      | Lender (netted from payout)                  |
| Liquidation penalty share      | 2 of the 3 penalty points | Protocol and lenders (1 point to the keeper) |
| Refinance fee                  | 0.10% of principal        | Borrower                                     |
| Idle-capital vault (scheduled) | 5% of yield               | Lender                                       |

Full detail in [Fees](/protocol/fees.md).

## Unit economics at scale

At 50M USDG average loans outstanding, a 30-day average term and an 8% average APR:

| Line                          | Calculation            | Annual (USDG) |
| ----------------------------- | ---------------------- | ------------- |
| Origination                   | 50M × 12 turns × 0.25% | \~1.5M        |
| Interest share                | 50M × 8% × 10%         | \~0.4M        |
| **Total before liquidations** |                        | **\~1.9M**    |

Protocol operations, audits and the bounty are covered from around 30M to 40M USDG outstanding.

## Why the fees are where they are

* **Origination** is charged to the borrower because the borrower initiates the loan and receives the liquidity.
* **Interest share** is charged to the lender because it scales with the return the protocol enabled and is only paid when the lender is paid.
* **Refinance** is charged to the borrower because it is a service to the borrower (avoiding the maturity cliff).
* **Liquidation** penalty is charged to the defaulting borrower and split so that keepers are paid to act and lenders are compensated for the disruption.

## What the protocol does not monetise

* It does not take a spread between lend and borrow rates; there is no such spread in a peer-to-peer market.
* It does not sell order flow; the book is public and exportable.
* It does not charge for reading data; the indexer and explorer are free and open source.

## Use of funds

Fees fund audits, the bug bounty and operations. The governance module directs allocation once it takes over parameter control. See [Corporate structure](/compliance/corporate-structure.md).


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