Points

Points reward the activity that makes Spout work: collateral that earns premium, and USDC that funds loans. Points are earned from real protocol fees, not from simply holding a balance.

How points are created

• Each time a contract settles, it produces a protocol fee.
• Every $1 of that fee creates 100 points.
• 58% of those points go to the collateral side (borrowers) and 42% to the capital side (lenders).
• Within each side, points are shared by how much you had in and for how long, measured hourly over the contract's life.
• Your share is multiplied by your loyalty multiplier.

Loyalty multiplier

Each deposit ages on its own. When you withdraw, your newest deposits are taken out first, so your oldest keep their multiplier.

An example

In one week, settled contracts produce $6,000 of protocol fees, which creates 600,000 points:

• 348,000 go to the collateral side. If your collateral was 1% of that side's dollar hours (dollars held multiplied by hours held), you get 3,480 points, times your multiplier.
• 252,000 go to the capital side. If your lending was 2% of that side's dollar hours, you get 5,040 points, times your multiplier.

Rules

• One person, one balance. All wallets linked to your account earn into one balance.
• Lending against your own loan does not count. If you borrow and lend at the same time, your lending is reduced by your own loan before capital side points are calculated.
• Points never affect your LTV or your borrowing limit.
• Testnet activity does not earn points.

Using points

• Points become usable 7 days after you earn them.
• 1,000 points = $1, credited to your lending balance as Senior or Junior shares. The minimum redemption is 5,000 points.
• Points expire after 24 months, or after 12 months without earning any.

The full terms of the points program are in the app.