# Using fCash

### Fixed rate lending

To lend at a fixed rate using fCash, users can swap their cash for fCash on one of Notional's native liquidity pools. The exchange rate at which they trade cash for fCash determines a fixed interest rate over the period of their loan.

Here is how to determine the fCashAmount you will buy given a cashAmount, interestRate, and timeToMaturity. Here, timeToMaturity is measured in years (six months = 0.5, three months = 0.25).

$fCash Amount = cashAmount * e^{(interestRate * timeToMaturity)}$

And here is how to determine the interestRate given a cashAmount, fCashAmount, and timeToMaturity.

$interestRate = ln(fCashAmount/cashAmount) / timeToMaturity$

### Lending example

A user wants to lend 100 USDC for six months on Notional, and the interest rate is 5%. Here's how much fCash they will get:

cash = 100
interestRate = 0.05
timeToMaturity = 0.5
fCash = 100 * e^(0.05 * 0.5) = 102.53

The user can wait until maturity to claim their 102.53 USDC, or they can choose to exit early by swapping their 102.53 fUSDC for USDC on the liquidity pool. The amount of USDC they get back will depend on the remaining time to maturity and the market interest rate at the time they make the swap.

### Fixed rate borrowing

To borrow at a fixed rate using fCash, users can deposit collateral and mint a pair of fCash tokens - a positive fCash token and a negative fCash token. The user will then swap the positive fCash token on one of Notional's liquidity pools in exchange for cash.

At the end of the borrow transaction, the user will have collateral, the cash they borrowed, and a negative fCash token that represents their obligation at maturity.

### Borrowing example

Let's say you have 1 ETH (valued at \$2,000) and you want to borrow 1,000 USDC for six months. To do this you will need to deposit the ETH into Notional and mint 1,000 USDC worth of a six month fCash pair. Then you will swap the positive fCash tokens for 1,000 USDC. Here's how much fCash you would need to mint assuming the interest rate is 5%:

cash = 1,000
interestRate = 0.05
timeToMaturity = 0.5
fCash = 1,000 * e^(0.05 * 0.5) = 1,025.32

After you do the swap, your portfolio would look like this:

Cash = 1,000 USDC
Obligation = -1,025.32 fCash
Collateral = 1 ETH
LTV = ~50%