# Is the interest rate always 20% **URL:** \ **Category:** General\ **Created:** [May 7, 2021, 6:36am UTC](https://forum.anchorprotocol.com/t/is-the-interest-rate-always-20/499 "2021-05-07T06:36:08Z")\ **Posts on this page:** 11\ **Page:** 1
**Author:** ![Nuuu](https://avatars.discourse-cdn.com/v4/letter/n/34f0e0/32.png) [@Nuuu](https://forum.anchorprotocol.com/u/Nuuu)\ **Post date:** [May 7, 2021, 6:36am UTC](https://forum.anchorprotocol.com/t/is-the-interest-rate-always-20/499/1 "2021-05-07T06:36:09Z")
It does not seem to change. Is that because we are in the introductory period so it is high and fixed to incentivize depositors? Or is there a mechanism behind it? I was watching this Youtube [video](https://www.youtube.com/watch?v=7HLiZxkbxfY) on Terra, and the guy said that “Anchor’s yield is powered by steady staking rewards from multiple PoS blockchains, offering attractive and low-volatile interest rates on stablecoin deposits.” But if that is true, then the staking rewards will be in non-stablecoin tokens, which will introduce volatility in interest rates. Any thoughts? thx ---
**Author:** ![dokwon](https://avatars.discourse-cdn.com/v4/letter/d/b5a626/32.png) [@dokwon](https://forum.anchorprotocol.com/u/dokwon)\ **Post date:** [May 10, 2021, 7:41am UTC](https://forum.anchorprotocol.com/t/is-the-interest-rate-always-20/499/2 "2021-05-10T07:41:30Z")
The staking rewards are sold off for UST and distributed in UST Hope that helps! ---
**Author:** ![Nuuu](https://avatars.discourse-cdn.com/v4/letter/n/34f0e0/32.png) [@Nuuu](https://forum.anchorprotocol.com/u/Nuuu)\ **Post date:** [May 10, 2021, 7:54pm UTC](https://forum.anchorprotocol.com/t/is-the-interest-rate-always-20/499/3 "2021-05-10T19:54:24Z")
Thanks Do. Have a follow-up question on the mechanics: The collateral provided by borrowers is bLuna, which gives them the rights to the staking rewards. So then how is it that the staking rewards are used to pay the interest? ---
**Author:** ![veleron](https://avatars.discourse-cdn.com/v4/letter/v/c77e96/32.png) [@veleron](https://forum.anchorprotocol.com/u/veleron)\ **Post date:** [May 11, 2021, 4:45am UTC](https://forum.anchorprotocol.com/t/is-the-interest-rate-always-20/499/4 "2021-05-11T04:45:40Z")
when you provide bLuna as collateral, you don’t get to receive the staking rewards from your bLuna. If you convert your luna to bLuna and didn’t provide collateral, you will get the staking rewards (without airdrops) in the form of UST. hope this helps ---
**Author:** ![Nuuu](https://avatars.discourse-cdn.com/v4/letter/n/34f0e0/32.png) [@Nuuu](https://forum.anchorprotocol.com/u/Nuuu)\ **Post date:** [May 11, 2021, 5:41am UTC](https://forum.anchorprotocol.com/t/is-the-interest-rate-always-20/499/5 "2021-05-11T05:41:28Z")
Thanks Veleron. Are you sure that bLuna dont get the MIR and ANC airdrops? I thought I read some place that they do ---
**Author:** ![ryanology045](https://sea2.discourse-cdn.com/flex016/user_avatar/forum.anchorprotocol.com/ryanology045/32/14_2.png) [@ryanology045](https://forum.anchorprotocol.com/u/ryanology045)\ **Post date:** [May 11, 2021, 5:57am UTC](https://forum.anchorprotocol.com/t/is-the-interest-rate-always-20/499/6 "2021-05-11T05:57:14Z")
Token airdrops like MIR and ANC are not distributed to bLuna holders as of this date ---
**Author:** ![CryptoNaut1000](https://avatars.discourse-cdn.com/v4/letter/c/eada6e/32.png) [@CryptoNaut1000](https://forum.anchorprotocol.com/u/CryptoNaut1000)\ **Post date:** [May 12, 2021, 7:25am UTC](https://forum.anchorprotocol.com/t/is-the-interest-rate-always-20/499/7 "2021-05-12T07:25:14Z")
How likely is it, that the interest rate will drop? For example, I imagine the next bear market and lots of capital flowing out of the ecosystem and coin prices drop. Will the interest rate remain stable? ---
**Author:** ![cpinter10](https://avatars.discourse-cdn.com/v4/letter/c/3da27b/32.png) [@cpinter10](https://forum.anchorprotocol.com/u/cpinter10)\ **Post date:** [May 12, 2021, 11:43pm UTC](https://forum.anchorprotocol.com/t/is-the-interest-rate-always-20/499/8 "2021-05-12T23:43:18Z")
Where do token airdrops (MIR and ANC) go currently? It appears the Airdrop Registry is meant to handle this and there exists code to claim and swap them into UST. But I’m unable to find any transactions including these airdrops. Have the Airdrops been unclaimed so far? Or do the airdrops get claimed and swapped but then sent elsewhere (i.e. NOT to bLuna holders)? ---
**Author:** ![wtzr](https://avatars.discourse-cdn.com/v4/letter/w/9e8a1a/32.png) [@wtzr](https://forum.anchorprotocol.com/u/wtzr)\ **Post date:** [May 19, 2021, 8:20pm UTC](https://forum.anchorprotocol.com/t/is-the-interest-rate-always-20/499/9 "2021-05-19T20:20:32Z")
Today, is the first time I experience a rate below 20%. I guess this has to do with the massive dump of today. No blaming at all, just curious how this happens. Because this is exactly the scenario I was curious to see happing. (What will happen if there is a massive dump/liquidation). ---
**Author:** ![Nuuu](https://avatars.discourse-cdn.com/v4/letter/n/34f0e0/32.png) [@Nuuu](https://forum.anchorprotocol.com/u/Nuuu)\ **Post date:** [May 19, 2021, 10:53pm UTC](https://forum.anchorprotocol.com/t/is-the-interest-rate-always-20/499/10 "2021-05-19T22:53:53Z")
Hmm… I thought the rates only change upon governance vote. Was there a proposal and vote? ---
**Author:** ![ryanology045](https://sea2.discourse-cdn.com/flex016/user_avatar/forum.anchorprotocol.com/ryanology045/32/14_2.png) [@ryanology045](https://forum.anchorprotocol.com/u/ryanology045)\ **Post date:** [May 20, 2021, 3:28am UTC](https://forum.anchorprotocol.com/t/is-the-interest-rate-always-20/499/11 "2021-05-20T03:28:35Z")
You can read up on Anchor’s deposit rate mechanism in the docs. Relevant sections are: - [Deposit Rate Subsidization - Anchor Protocol](https://docs.anchorprotocol.com/protocol/money-market/deposit-rate-subsidization) - [Modify Market Parameters - Anchor Protocol](https://docs.anchorprotocol.com/protocol/anchor-governance/modify-market-parameters)