Early Withdrawal Cost Calculation
Early Redemption of Freezer NFTs has a variable frETH fee and a 0.25% WETH penalty.
1 frETH is minted per 1 ETH-YEAR locked. Where for simplicity 1 Year always equals 365 Days. Upon deposit, immediate early withdrawal of a NFT costs 1.20x the frETH minted from that NFT's creation. This amount falls to 1x frETH minted over the first 67% of the lock duration. In the final 33% of the lock duration, it rapidly falls to 0 frETH on/after the maturity date. A 0.25% WETH penalty is assessed on all Freezer NFTs prior to maturity date. On/after maturity, this is 0%.
When an NFT is redeemed prior to 67% of its lock time, more frETH is required than was originally minted for the NFT. 50% of this amount above minted is given to FRZ stakers, the rest is burned. NFTs redeemed in the final 33% of their lock time have all the frETH fee burned (the 0.25% WETH penalty always goes to FRZ stakers). Example: Alice locks 90 WETH for 3 Years (1,095 days). She mints 270 frETH for doing this. Her Early Withdrawal Costs in frETH start high and drop to 0, i.e., her NFT becomes more valuable daily.
Date | Progress | frETH Fee | WETH Penalty |
---|---|---|---|
Day 1 | 0% | 324 frETH (270 frETH * 1.20) | 0.225 WETH (90 WETH * 0.25%) |
Day 365 | 33% | 297 frETH | 0.225 WETH |
Day 730 | 67% | 270 frETH | 0.225 WETH |
Day 912 | 85% | 135 frETH | 0.225 WETH |
Day 1095 | 100% | 0 frETH | 0.00 WETH |
In Code form:
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