Trading Fees
Fee Types
Trading Fees: Fees for opening and closing positions
Funding Fees: Fees for holding positions overnight (based on funding velocity)
Liquidation Fees: Fees for liquidated positions
Bridge Fees: Fees for withdrawing funds between chains
Trading Fees
Maker/Taker Model
Maker Fees: Fees for providing liquidity (limit orders)
Taker Fees: Fees for taking liquidity (market orders)
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
Standard
0.04%
0.06%
Default tier
VIP 1
0.025%
0.0525%
$10M+ trading volume
VIP 2
0.0225%
0.05%
$25M+ trading volume
VIP 3
0.02%
0.045%
$50M+ trading volume
VIP 4
0.0175%
0.04%
$100M+ trading volume
VIP 5
0.015%
0.035%
$250M+ trading volume
VIP 6
0.0125%
0.03%
$500M+ trading volume
VIP 7
0.01%
0.025%
$1B+ trading volume
VIP 8
0.005%
0.02%
$2.5B+ trading volume
VIP 9
0.00%
0.015%
$5B+ trading volume
Funding Fees
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
Unbalanced Positions: When long/short positions are imbalanced, funding rate velocity increases
Continuous Drift: Funding rates drift continuously until positions rebalance
Zero-Sum: LPs neither gain nor lose funding over time - funding flows through them
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
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 Trading Fees: Lower maker/taker fees
Priority Support: Enhanced customer support
Advanced Features: Access to additional trading features
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 governance
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