> For the complete documentation index, see [llms.txt](https://nebula-18.gitbook.io/nebula/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://nebula-18.gitbook.io/nebula/tech-overview/nebula-technology-overview/risk-management-and-security/interest-rate-risk.md).

# Interest Rate Risk

Dynamic interest rates ensure fair pricing and reduce liquidity risks.

#### **Utilization-Based Adjustments**

* **High Utilization:** When utilization exceeds 90%, borrowing rates increase to attract more liquidity.
* **Low Utilization:** Rates decrease to incentivize borrowing and maintain equilibrium.

#### **Rate Stability**

* **Stable Rate Options**: Borrowers can opt for stable rates, providing predictable repayment terms and mitigating risks from sudden rate spikes.

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