Skip to main content

Early redemption rules

  • Updated

Content

When redeemed early by the user

When redeemed by liquidation

Redeemed amount
  1. WhaleFin only supports the user to enter redeemed principal, and will automatically calculate the redeemed interest and the bonus interest.
  2. Maximum redeemable principal amount = remaining principal amount
  3. Users are not allowed to redeem their assets when the following conditions are met:
  • the user has leveraged position
  • the user enables cross margin with Earn
  • the user's margin risk ratio >= 100%

Liquidation order: the assets will be redeemed pro rata based on the principal + accrued interest + bonus interest

Redeemed interest

Recalculated based on (redeemed interest * 2.00% APR * holding days / 365), and the excess portion will be deducted as penalty/transaction fees

Remains unchanged (no penalty)

Bonus interest

1. The settled portion will be redeemed pro rata

2. The remaining portion will not be settled (in case of interest arbitrage)

1. The settled portion will be redeemed pro rata

2. The remaining portion will still be settled according to the original coupon rules

Time of receipt

Instant

Instant

Remaining principal after redemption

Calculated at the original APR

Calculated at the original APR and the original coupon rules (if any coupon is used)

 

Example:

If user A subscribes to the Earn product [BTC-30 days-5%] on 04/01 with 10 BTC, and applies a 1% bonus interest coupon that is valid for 15 days; and user A redeems 5 BTC on 04/10, then:

  1. Redeemed principal = 5 BTC
  2. Accrued interest = Early redeemed principal * 2.00% * Holding days / 365 = 5 * 2.00% * 10 / 365 = 0.002739726027397
  3. Accrued bonus = (Early redeemed principal amount / Principal) * Accrued interest before first redemption = (5 / 10) * 10 * 1% * 10 / 365 = 0.001369863013699
  4. Actual redeemed amount = Early redeemed principal amount + (Early redeemed principal amount * 2.00% * Holding days / 365) + (Early redeemed principal amount / Principal) * Realized coupon APR = 5 + 0.002739726027397 + 0.001369863013699 = 5.004109589041096
  5. After early redemption:
  • The bonus interest coupon is invalid, i.e. the coupon is 5 days from expiry, and the remaining portion of interest will not be settled
  • The remaining principal of 5 BTC will be settled at 5%, the original APR

Related articles