Yield
Where Your Yield Comes From
As an LP, you earn from three fee streams — all generated by real trading activity, not token emissions:
Trading Fees
Every time a trader opens or closes a position, they pay a fee. A portion goes directly to your pool, increasing your HzLP/HzV token value.
Borrow Fees
Traders pay an hourly borrow fee for using your liquidity as leverage. The more your pool is utilized, the higher the borrow rate — and the more you earn.
Liquidation Fees
When a trader's position is force-closed, a liquidation fee is charged. This compensates you for bearing the execution risk.
All fees settle continuously into the pool. Your HzLP/HzV tokens appreciate automatically — no manual claiming required.
Understanding APY
The platform shows two yield metrics:
Fee APR
Annualized returns from trading fees only (open, close, borrow, liquidation)
Lower — steady baseline
Total APY
All yield sources including trader PnL impact
Higher — includes PnL variance
Fee APR gives you a conservative baseline of what to expect from fee income alone. Total APY is the complete picture, but it swings more because trader PnL can go either way.
APY formula:
Example: If a pool generates 0.1% daily APR from fees, the compounded APY is approximately 44%.
APY is variable and not guaranteed. Past performance does not predict future results.
Revenue Distribution
You (LPs)
63%
Compensation for providing liquidity and bearing counterparty risk
Protocol Treasury
37%
Reinvested into protocol growth: protocol-owned liquidity, gas subsidies, trading competitions, trader rebates, LP insurance backstops, and incentive campaigns
The treasury share ultimately flows back to benefit LPs and traders — through deeper liquidity, better incentives, and stronger protocol resilience.
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