Fee Structure
Fee model, calculation methodology, and worked examples for bizUSDT0.
Fee Structure
bizUSDT0 employs a simple, performance-aligned fee model: zero management fees and a 10% performance fee levied on gains above a high-water mark (HWM).
Fee Summary
| Fee Type | Rate | Basis |
|---|---|---|
| Management Fee | 0% | None |
| Performance Fee | 10% | Net USDT0-denominated gain above HWM |
| Entry Fee | 0% | None |
| Exit Fee | 0% | None |
Performance Fee Calculation
Methodology
The performance fee is calculated on the net USDT0-denominated gain in vault share price above the all-time high-water mark.
Formula:
Fee = 10% * (Current NAV per Share - HWM per Share) * Total Shares OutstandingKey Properties:
- Denominated in USDT0: All calculations use USDT0 as the unit of account. FLR price fluctuations do not affect the fee basis.
- Net of all costs: The NAV per share already reflects swap costs, gas expenditures, and any other operational drag.
- Crystallized monthly: Fees are calculated and accrued at the end of each calendar month.
- Paid in-kind: Fees are paid in USDT0 (or USDT0-denominated vault shares) to the fee recipient.
High-Water Mark Rules
- The HWM is set at the initial share price (1.0000 USDT0) at vault launch.
- The HWM tracks the highest NAV per share ever achieved.
- The HWM never resets downward. If the NAV declines (e.g., due to a negative event), the fee is zero until the NAV recovers above the previous HWM.
- Each new NAV high becomes the new HWM.
Fee Accrual Frequency
- Fees are crystallized monthly at the end of each calendar month.
- Between crystallization dates, fees are tracked internally but not yet transferred to the fee recipient.
- The monthly crystallization ensures that short-term NAV fluctuations do not result in over-payment of fees.
High-Water Mark Reset
- The HWM never resets downward.
- If the NAV per share declines (due to negative events, costs, or market conditions), the performance fee is zero until the NAV recovers above the all-time high.
- There is no "fresh start" or HWM reset mechanism — the HWM is perpetual for the life of the vault.
Fee Payment Mechanism
- Method: In-kind (USDT0 or USDT0-denominated vault shares).
- Recipient:
0xf19cE0b11562b27D7354B22429fB10ae1185cF8a - Frequency: Monthly crystallization; payment transferred within 5 business days of month-end.
- On-Chain Record: All fee payments are visible as transactions from the vault address to the fee recipient address on FlareScan.
Key Differentiators
- Zero management fee aligns the curator's incentives with depositors, which means no revenue without positive performance.
- 10% performance fee is at the lower end of the DeFi vault range.
- Perpetual HWM (no annual reset) is depositor-friendly, the curator must recover any losses before earning fees again.