The primary cost of borrowing is the variable interest rate you pay on your loan, which is clearly displayed for each asset.
Here's a simple breakdown:
- Protocol Fee:
- Protocol doesn't charge any additional fees on top of the interest payments - Solana network costs:
- Metaplex metadata account: ~0.0151 SOL (to show NFT name and logo)
- NFT position account: ~0.00146 SOL (network rent paid for the NFT)
- Tick initialization: ~0.00246 SOL (allows D/C ratio setup for your specific borrowed asset pair)
What is tick initialization?
Jupiter Lend uses a tick-based system to manage liquidations across different debt-to-collateral ratios.
A tick represents a specific ratio level inside a vault. When a position enters a new ratio level that hasn’t been used before, the protocol initializes the corresponding tick on-chain.
Ticks are spaced by 0.15% and are shared globally within a vault: once a tick is initialized by any user, all users can reuse it. Each tick is created only once per vault.
As vault usage increases, fewer new ticks need to be initialized, which reduces transaction costs over time.
Tick initialization during liquidations:
In some cases, liquidations require initializing an additional on-chain account to store liquidation data for a given tick. Each liquidation-related tick account can record up to three liquidations. After the third liquidation, a new one may need to be initialized. These liquidation tick accounts are:
• Shared globally per tick per vault (not per user)
• Initialized only when needed
• Usable for three liquidations before a new one is required
This tick-based design is a key reason why liquidations on Jupiter Lend are highly efficient and minimally punitive, enabling lower liquidation penalties and higher LTVs.