While we eventually plan to move to a reactive interest rate model that will optimise for utilisation, we start off with a standard kink model. The parameters of our kink model are:
1.
Base IR (APY when utilisation is 0%)
2.
Kink IR (APY when utilisation is exactly Kink%)
3.
Max IR (APY when utilisation is 100%)
4.
Kink% (Percent utilisation where kink occurs)
The main consideration is maintaining target utilisation (typically at Kink%).