Collateral and Reserves (Optimism)

Reserves are an accounting entry in each soToken contract that represents a portion of historical interest which can be withdrawn or transferred through the protocol's governance. A small portion of borrower interest accrues into the protocol, determined by the reserve factor. The reserve factor is the percentage of interest paid to the Sonne Finance. If the reserve factor is 10, then that would imply a 10% rate of interest paid on the borrowed asset allocated to Sonne.

Sonne implements the collateral and reserve mechanic implemented by Compound Finance.

Borrow caps: OP : 4.5M SNX : 4.5M

Collateral factors, and/or reserve factors, may be adjusted from time to time, depending on factors such as the liquidity for a particular asset.

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