# Revenue Model

## Universal Fee

Vesper uses a simple, transparent fee structure designed to ensure you never earn negative returns on your deposits. 

*\*APY shown on the Vesper app is calculated after all fees have been applied.*

#### How It Works

Vesper charges a **2% annual fee** on your deposited principal, collected from your earned yield at each rebalance. However, this fee is capped. If 2% of your principal exceeds half of what you've earned, only 50% of your yield is taken instead.

#### Why This Model?

The universal fee eliminates that possibility while remaining straightforward to understand.

* **No withdrawal fees** means you can withdraw anytime without penalty.
* **No deposit fees** enable your full deposit to go to work immediately.
* **Fees come only from yield,** so your principal is never touched.

#### Fee Calculation

At each rebalance, the fee is calculated as:

```
Fee = 2% * (blocks since last rebalance / blocks per year) * TVL
```

If this amount exceeds 50% of the yield earned, the fee is reduced to 50% of the yield instead.

## Yield Mechanics

For community pools, a 5% share of both of these fees goes to the developer who authored the strategy. This is paid in the pool’s asset.