What Is FRR? How Bitfinex Lending Rates Are Set

Bitfinex lending has no posted rate. The price comes from the offers borrowers and lenders put on the funding book. FRR is a separate reference number that Bitfinex calculates, and first-time lenders often pick it by default, so it's worth knowing what it actually measures.

How FRR is calculated

Bitfinex's documentation defines FRR as the average rate of all active fixed-rate loans, weighted by amount and updated every hour.

In other words, FRR tells you what money that's already lent out is earning on average. It includes loans that filled days or even weeks ago, with rates locked in back then, so it isn't the rate the market is filling at right now.

You can look up FRR for each currency on Bitfinex's Market statistics page.

Rate units

Bitfinex quotes lending rates per day. Multiply by 365 for a simple, non-compounded APR: 0.02% a day is about 7.3% a year, and 0.05% a day is about 18.25%. What you actually receive is lower after Bitfinex's fee; the math is in How Bitfinex lending interest works.

FRR options when you place an offer

• FRR: the rate is FRR itself, and it follows FRR hour by hour for the life of the loan.
• FRR Delta Variable: FRR plus or minus a set amount, still following FRR during the loan. Bitfinex's example: with FRR at 0.045 and a delta of 0.001, the rate is 0.046.
• FRR Delta Fixed: before the offer fills, the rate tracks FRR plus the delta. Once it fills, the rate is locked and no longer changes.

Offers at FRR don't match fixed-rate borrow requests. They only fill against borrowers who also use FRR.

What to watch when you lend at FRR

FRR is an average that includes older loans, so it's always a step behind when the market moves.

When borrowing demand suddenly jumps, fills can run well above FRR, and lending at FRR means earning less than you could. When the market cools, the opposite happens: FRR is still sitting near the highs of the past few days, and a fixed rate priced off it may wait a long time for a borrower.

The upside is convenience. An FRR loan moves with the market average, and you never have to reprice it by hand.

EZLO doesn't use FRR as its offer price. It prices off the rates actually filling in the market. To choose how long to lend for, read Bitfinex lending period next.