Every rate on the platform comes from a single curve. Utilization is the share of a market’s supplied assets currently borrowed, and the borrow rate is that curve read at whatever utilization the market currently sits at. The rate recalculates continuously as borrowers draw and repay, which is why a rate quoted this morning can differ materially by the afternoon.
Every AGI3 market uses this curve, with these values.
Hover the chart to read both rates at any utilization.
The three segments
The curve is three straight segments joined at two kinks.
Below 85% utilization the borrow rate climbs gently, from 0% at rest to 5% at the first kink. A market spends most of its life in this stretch, and the cost of borrowing moves slowly within it.
Between 85% and 93% the slope steepens, carrying the rate from 5% to 7% across eight points of utilization.
Above 93% the curve turns close to vertical, running from 7% to 40% across the final seven points. More than four fifths of the rate range sits in the last seven points of utilization.
Why the last stretch is vertical
The steep final segment is what stops a market being borrowed to exhaustion. As utilization approaches 100%, borrowing becomes expensive enough that borrowers repay and suppliers are drawn in, and both push utilization back down. The rate is the mechanism that restores withdrawable liquidity.
That has a direct consequence for anyone who may need to exit: a market can only return what it currently holds. Supply assets covers what a capped withdrawal looks like, and the liquidity component of the portfolio health score scores exactly this exposure.
What you earn when you supply
Suppliers earn interest on the borrowed portion of a market, not on everything supplied. The supply rate is therefore the borrow rate scaled by utilization:
At 50% utilization the borrow rate is 2.94% and the supply rate is 1.47%. At 93% they are 7.00% and 6.51%. The two converge as utilization approaches 100%, because at full utilization every supplied unit is lent out and earning.
This is why a market can advertise a high borrow rate and still pay suppliers modestly. If little of the supply is lent, little of it earns.
What it costs to borrow
A borrow rate is a market variable, not a contract term. A position opened while its market sat at 85% utilization costs 5%; the same position at 95% costs roughly 16%. Nothing about the position needs to change for that to happen.
Utilization moves for reasons unconnected to you. Other borrowers draw, and suppliers withdraw. Both raise utilization, and the effect on your cost is sharpest exactly where the curve is steepest. Borrowing basics covers what that does to an open position, Net APY shows how a rate move can invert a position that was profitable at open, and Monitor positions and alerts sets out a routine for catching it.
Where to read it in the product
Every market page shows its current utilization alongside its current rates. The curve is what connects the two: utilization is the input, and both rates are outputs of it. How yield is calculated covers the legs that sit on top of this base rate, including rewards programs. 
