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The protocol charges a percentage of net profit made by traders, calculated in BNB. The fee is decided by WOWswap Governance.
Let suppose that a net profit fee is 5%, and a trader buys a token for 10 BNB with 5 X leverage (50 BNB in total). If the token’s price increases by 20%, then the trader’s gross profit is 1.250 * 50 – 40 BNB (borrowed) = 20 BNB. Suppose, the cost of capital was 0.5 BNB, so the net profit will be 19.5 BNB. The protocol fees will be 0.0519.5 = 0.975 BNB.
50% of this amount will go to the insurance fund (0.4875 BNB), and another 50% will be spent to buy and burn WOW tokens.