Borrow against your
stocks at 0% interest

Everything you need to know about Spout and how we’re changing decentralized investing.

• How can Spout offer 0% interest loans?

  Because your collateral pays for the loan, not your wallet. While your stocks sit as collateral, the protocol writes covered calls against them and the premium income pays the lenders who fund your loan. Think of it like renting out the side of a building for a billboard. The building (your shares) still belongs to you, but while it's there, it earns rent. That rent covers the lender's yield, which is why no one has to charge you interest to make the math work.

• Can I lose my stocks?

  Only if the call written against them finishes in the money at expiry, and even then it is a clean exchange: your shares are sold at the strike, the proceeds first repay any outstanding loan, and you keep the leftover cash plus the premium that was paid up front. With Auto-Roll on (the default) the protocol immediately re-buys the same asset so your position is restored. You can never lose more than the collateral you posted. Loans are non-recourse.

• Do I always have to KYC?

  No. KYC is only required to hold or borrow against tokenized stocks, because the tokens themselves enforce wallet-level verification to stay compliant with US securities rules. If you are just lending stablecoins to the protocol, no KYC is required. You connect your wallet, deposit, and earn.

• Where are my shares actually held?

  At a regulated US broker-dealer, in segregated custody, 1:1 against the tokens in your wallet. The backing is attested onchain via an oracle-based Proof of Reserve, so you can verify the share count against the supply at any time. The protocol can write options against your shares but never has authority to move them out from under you.

• Where does the lender yield actually come from?

  From the volatility risk premium: the persistent gap between the price of options and the actual moves stocks deliver. Pension funds buy options as insurance, retail buys them as lottery tickets, and dealers hedge their books mechanically. All three flows push implied volatility above what realized volatility ends up being. Spout sits on the other side of those buyers and pays the difference out to lenders. The strategy has decades of academic and institutional backing; what's new is delivering it onchain to anyone holding stablecoins.

• Can I withdraw my deposit whenever I want?

  Lender deposits have no lockup. You can withdraw your stablecoins at any time, subject only to available pool liquidity. Borrower collateral has a short cooldown after loan repayment so the position can exit the current options cycle cleanly, but you always retain the right to repay your debt and close the loan at any moment.

• What happens if the price of my collateral drops?

  Every loan has a Health Factor: the buffer between your collateral value and the liquidation threshold. Above 1.00 you are safe; below it, a partial liquidation sells just enough collateral to bring the position back into the safe zone. Penalties are small by DeFi standards, and we notify you well before any threshold is approached. There are no funding-cost margin calls because there is no funding cost; your Health Factor only moves when the market does.

• Do I still earn dividends on my stocks?

  Yes. Dividends paid by the underlying shares flow back to spAsset holders, net of any required US withholding (30% for non-US persons, applied at the broker level). They are not absorbed by the protocol.

• Can I use Spout from outside the United States?

  Yes, subject to KYC. spAssets enforce wallet-level verification at the token level, so they can only move between verified holders. Non-US users are subject to the standard 30% US dividend withholding on equity dividends.

• How is this different from margin loans or DeFi lending I already use?

  Margin loans at a retail broker charge 8 to 13% APR for the same collateralized borrowing, and 30 to 50% or higher at brokerages in many emerging markets. DeFi lending platforms charge variable interest that floats with utilization and do nothing productive with the deposited assets. Spout is the only place where your stocks themselves do the work: the borrow rate goes to zero because the collateral is generating yield in the background, and lenders earn a real, structural yield instead of just collecting interest spread.