Lido (LDO) announced that the fee model for its stablecoin-based yield-generating vault, EarnUSD, will be changed to a structure with lower fixed fees, higher flexibility, and fees directly linked to vault performance. The existing structure was centered around platform fees, but the new model emphasizes performance-based fees. Accordingly, the fee structure will change from the existing 1% Assets Under Management (AUM) fee and 10% performance fee to a maximum AUM fee of 0.5% and a maximum performance fee of 20%. The initial fee rates are expected to be set at an AUM fee of 0.2% and a performance fee of 15%. Adjusting the AUM fee from 1% to 0.2% lowers the cost of holding EarnUSD when yields are low.
