> For the complete documentation index, see [llms.txt](https://arcticai.gitbook.io/arctic-protocol/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://arcticai.gitbook.io/arctic-protocol/how-is-yield-generated.md).

# How is yield Generated?

Arctic protocol provides full or or partial Liquidity to users at an interest rate of 5 \~ 10% per month. 

In certain cases the protocol may generate revenue by collecting a percentage of revenue from taxed tokens. Taxable tokens will feature a lower initial interest rate but must undergo a pre-approval process.

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The LP tokens for the pool are held as collateral for the loan until duration expires or loans are repaid completely. This guarantees that all loans are fully secured, significantly reducing the operational risk.