diff --git a/docs/fassets/3-minting.mdx b/docs/fassets/3-minting.mdx index c21c8337..0eec9a76 100644 --- a/docs/fassets/3-minting.mdx +++ b/docs/fassets/3-minting.mdx @@ -51,13 +51,16 @@ The following fees are paid to mint FAssets: ### Collateral Reservation Fee -The **collateral reservation fee (CRF)** is paid in native tokens by the minter at the same time the [CRT](#minting-process) is made. +The **collateral reservation fee (CRF)** is paid in native tokens by the minter at the same time the [collateral reservation](#minting-process) is made. The CRF is defined by governance as a percentage of the minted value, and the same fee applies to all agents. -When the minter does not pay on the underlying chain, this fee compensates the agent and the CPT holders for the time their collateral was locked while the mint processed. -If the minter pays on the underlying chain, the CRF is burned. +The purpose of the CRF is to compensate the agent and collateral pool token (CPT) holders for the time their collateral is locked during the minting process. -For underlying chains on which proving payments takes a long time, the fee might be higher than the fee on chains that quickly prove payments. +- If the minter does not pay on the underlying chain, the CRF is distributed to the agent and the pool in the same share as the minting fee. +- If the minter successfully pays on the underlying chain, the CRF is also distributed to the agent and the pool in the same manner. + +For underlying chains where proving payments takes longer, the CRF might be set higher to account for the extended lock-up time. +The CRF percentage is defined by governance and may vary based on the performance of the underlying chain. ### Minting Fee