What it means
How much of a lending pool is currently borrowed, as a share of everything supplied.
Rates rise with utilisation, and steeply once it passes a set point, to pull in lenders and push out borrowers.
How it works
At very high utilisation, lenders may have to wait to withdraw.
Related terms
| Term | What it means |
|---|---|
| Borrow rate | The variable interest a borrower pays on a loan in a lending market. |
| Supply rate | The variable interest earned for supplying tokens to a lending market. |
| Liquidity | How easily a token can be exchanged or withdrawn without moving its price. |
This glossary explains terms in general. It isn't investment, tax or legal advice.