# Trading Fees ## Fee Types * **Trading Fees:** Fees for opening and closing positions * **Funding Fees:** Fees for holding positions (based on funding velocity) * **Liquidation Fees:** Fees for liquidated positions * **Rollover Fees(Non crypto pairs)** : For carrying positions in non-crypto pairs ## Trading Fees ### Maker/Taker Model * **Maker Fees:** Fees for providing liquidity (limit orders) * **Taker Fees:** Fees for taking liquidity (market orders) Trading fees are **the same for both crypto and non-crypto pairs**.\ **BTC and ETH pairs currently have zero trading fees** on Polynomial. ### Skew-Based Pricing Trading prices include a premium/discount based on market skew to manage risk and create rebalancing incentives: * **Premium for Long Skew:** When long positions exceed short positions, prices include a premium * **Discount for Short Skew:** When short positions exceed long positions, prices include a discount * **Linear Pricing Function:** premium = skew / skewScale * **Execution Price:** Average price along the premium/discount curve * **Risk Management:** Creates soft limits on maximum exposure without restrictive open interest limits ### Fee Schedule | VIP Tier | Maker Fee | Taker Fee | Requirements | | ------------ | --------- | --------- | --------------------- | | **Standard** | 0.04% | 0.06% | Default tier | | **VIP 1** | 0.025% | 0.0525% | $1M+ trading volume | | **VIP 2** | 0.0225% | 0.05% | $2.5M+ trading volume | | **VIP 3** | 0.02% | 0.045% | $5.0M+ trading volume | | **VIP 4** | 0.0175% | 0.04% | $10M+ trading volume | | **VIP 5** | 0.015% | 0.035% | $25M+ trading volume | | **VIP 6** | 0.0125% | 0.03% | $50M+ trading volume | | **VIP 7** | 0.01% | 0.025% | $100M+ trading volume | | **VIP 8** | 0.005% | 0.02% | $250M+ trading volume | | **VIP 9** | 0.00% | 0.015% | $500M+ trading volume | ## Funding Rate Funding fees use a velocity-based model that creates smooth, predictable funding rate trajectories while maintaining zero-sum properties. ### Funding Rate Velocity Model Instead of instantaneous funding rates proportional to skew, the system uses funding rate velocity where: * **dr/dt = c × skew** (rate of change in funding rates) * Funding rates continuously drift higher/lower with uncorrected position imbalances * Creates natural price discovery for funding rates * Smooths funding rate trajectories for better UX ### Key Factors * **Market Skew:** Imbalance between long and short positions * **Funding Velocity:** Rate of change in funding rates (not instantaneous rates) * **Skew Scale:** Configurable parameter that modulates market liquidity * **Max Funding Velocity:** Maximum funding rate velocity when skew = skewScale ### How It Works 1. **Unbalanced Positions:** When long/short positions are imbalanced, funding rate velocity increases 2. **Continuous Drift:** Funding rates drift continuously until positions rebalance 3. **Zero-Sum:** LPs neither gain nor lose funding over time - funding flows through them 4. **Natural Rebalancing:** Creates incentives for market participants to balance positions ## Liquidation Fees * **Base Fee:** 50$ fixed fee for liquidation * **Market Impact:** Additional fee based on market impact * **Gas Costs:** Gas costs for liquidation transaction ## **Rollover Fees (Non-Crypto Pairs)** The **Rollover Fee** applies only to **non-crypto markets** such as **commodities, indices, metals, and forex**.\ It reflects the cost of carrying open positions over time and compensates **liquidity providers (LPs)** for providing liquidity when underlying markets are closed or volatile. * **Applies to both long and short positions equally** * **Non-zero-sum:** unlike funding fees (which flow between longs and shorts), this fee is paid by traders into the protocol and distributed to LPs * **Accrues continuously** and is **realized when the position is closed** You can view this directly in the **UI under “Interest Rate”**
#### **Example** If the **annualized rollover rate** is **10% for GOLD**, a **$10,000 position** held for **one day** incurs approximately **$2.74**, which is automatically deducted from your PnL when the position is closed. #### **Current Rollover Fee Rates** | Market | Annual Rate | | ------- | ----------- | | XAU | 10% | | XAG | 10% | | WTI | 10% | | NVDA | 10% | | TSLA | 10% | | HOOD | 10% | | PLTR | 10% | | GOOG | 10% | | COIN | 10% | | SPY | 5% | | DIA | 5% | | QQQ | 5% | | USD/JPY | 5% | | EUR/USD | 5% | ## Bridge Fees Bridge fees vary by destination chain and current network conditions. ## VIP Program VIP tiers are based on 30-day trading volume and provide: * **Reduced Fees:** Lower trading fees * **Priority Support:** Priority customer support * **Exclusive Events:** Invitation to exclusive events ### **VIP Requirements** * **Trading Volume:** Based on 30-day trading volume * **Account Balance:** Minimum account balance requirements * **Activity Level:** Regular trading activity * **Compliance:** Compliance with platform terms ### **VIP Tier Progression** ```typescript // VIP tier calculation function calculateVIPTier(tradingVolume: number) { if (tradingVolume >= 1000000) return 'VIP 5'; if (tradingVolume >= 500000) return 'VIP 4'; if (tradingVolume >= 100000) return 'VIP 3'; if (tradingVolume >= 50000) return 'VIP 2'; if (tradingVolume >= 10000) return 'VIP 1'; return 'Standard'; } ``` ## Fee Optimization ### **Reducing Trading Fees** * **Use Limit Orders:** Use limit orders to get maker fees * **VIP Program:** Participate in VIP program * **Volume Trading:** Increase trading volume for better rates * **Batch Orders:** Batch multiple orders together ### **Reducing Funding Fees** * **Market Timing:** Time entries to minimize funding costs * **Position Management:** Manage position sizes and timing * **Funding Rate Monitoring:** Monitor funding rate trends * **Arbitrage Opportunities:** Use funding rate arbitrage ### **Reducing Withdrawal Fees** * **Choose Optimal Chains:** Choose chains with lower fees * **Batch Withdrawals:** Batch multiple withdrawals * **Timing:** Withdraw during low gas periods * **Alternative Methods:** Use alternative withdrawal methods ## Fee Transparency ### **Fee Display** * **Pre-trade:** Fees displayed before trade execution * **Post-trade:** Fees shown in trade confirmation * **Account History:** All fees tracked in account history * **Real-time Updates:** Fees update in real-time ### **Fee Breakdown** * **Trading Fees:** Clearly separated from other fees * **Funding Fees:** Shown separately from trading fees * **Total Costs:** Total cost breakdown provided * **Fee History:** Historical fee data available ## Fee Comparison ### **Competitive Analysis** | Exchange | Maker Fee | Taker Fee | Funding Fee | | -------------- | --------- | --------- | ----------- | | **Polynomial** | 0.02% | 0.05% | Variable | | **Binance** | 0.02% | 0.04% | 0.01% | | **Bybit** | 0.01% | 0.06% | 0.01% | | **dYdX** | 0.00% | 0.05% | 0.00% | ### **Value Proposition** * **Competitive Rates:** Competitive with major exchanges * **Transparent Pricing:** Clear and transparent fee structure * **VIP Benefits:** Additional benefits through VIP program * **No Hidden Fees:** No hidden or surprise fees > > > > > > > f98d57c (Update documentation based on Discord feedback) ## Fee Payment * **Automatic Deduction:** Fees automatically deducted from account balance * **USDC Payment:** All fees paid in USDC * **Real-time Processing:** Fees processed immediately upon trade execution ## Price Feeds Polynomial uses Pyth Network for price feeds, providing: * **High-Frequency Updates:** Real-time price updates for accurate execution * **Decentralized Oracle Network:** Multiple data sources for reliability * **Low Latency:** Fast price updates to minimize slippage * **On-Chain Verification:** Price updates verified on-chain for security ## Important Notes * Fees are subject to change based on market conditions * VIP benefits may be updated over time * Always check current fee rates before trading * All fees are displayed before trade execution for transparency * Skew-based pricing and funding velocity parameters are configurable via governancentinuebort