Summary

In preparation for Notional’s upcoming quarterly roll occurring Wednesday, March 12th at 8:00 PM Eastern Time, we propose a set of parameter updates to Notional V3. Specifically, these interest rate models will be slightly narrower than Q1 2025 and reflect the lower level of interest rates across DeFi.

These interest rate models will focus fixed rate liquidity for ETH between 3% and 10.5%, between 7% and 18.5% for stables, between 1% and 8% for LSDs, and between 1% and 6% for wBTC. We believe that these curves will serve current market conditions well in addition to forecasted conditions in Q2 2025.

fCash Interest Rate Models

We propose the following set of fCash market parameters for Notional V3’s Mainnet and Arbitrum deployments.

3 Month fCash markets

Parameters	ETH	Stablecoins	LSDs	wBTC
kinkUtilization1	35	35	35	35
kinkUtilization2	80	80	80	80
kinkRate1 (1/256)	22 (3.05%)	36 (6.96%)	9 (0.88%)	15 (1.03%)
kinkRate2 (1/256)	75 (10.40%)	96 (18.56%)	81 (7.91%)	88 (6.02%)
maxRate25BPS	142 (35.5%)	158 (49.50%)	100 (25%)	70 (17.5%)
minFeeRate5BPS	8 (0.15%)	8 (0.15%)	8 (0.15%)	8 (0.15%)
maxFeeRate25BPS	3 (2%)	3 (2%)	3 (2%)	3 (2%)
feeRatePercent	8 (8%)	8 (8%)	8 (8%)	8 (8%)
Initial proportion	35%	35%	35%	35%
Deposit share	60%	60%	60%	60%
Leverage threshold	86%	86%	86%	86%

6 Month fCash markets

Parameters	ETH	Stablecoins	LSDs	wBTC
kinkUtilization1	35	35	35	35
kinkUtilization2	80	80	80	80
kinkRate1 (1/256)	22 (3.05%)	36 (6.96%)	9 (0.88%)	15 (1.03%)
kinkRate2 (1/256)	75 (10.40%)	96 (18.56%)	81 (7.91%)	88 (6.02%)
maxRate25BPS	142 (35.5%)	158 (49.50%)	100 (25%)	70 (17.5%)
minFeeRate5BPS	8 (0.15%)	8 (0.15%)	8 (0.15%)	8 (0.15%)
maxFeeRate25BPS	3 (2%)	3 (2%)	3 (2%)	3 (2%)
feeRatePercent	8 (8%)	8 (8%)	8 (8%)	8 (8%)
Initial proportion	35%	35%	35%	35%
Deposit share	40%	40%	40%	40%
Leverage threshold	86%	86%	86%	86%