Notional Finance Review 2024: Features, Fees, Pros, & Cons

Published: June 6, 2023   |   Last Updated: February 15, 2024
Written By:
Hristina Yordanova
Hristina Yordanova
Edited By:
Shannon Ullman
Shannon Ullman
Managing Editor

Our Take On Notional Finance


Notional Finance is a rising star in the DeFi space offering much-needed stability with its fixed interest rates.


  • Available globally with limited exceptions
  • Fixed interest rates offer a secure investment opportunity and predictability on returns
  • Numerous wallet integrations facilitate ease of use


  • Could potentially offer lower interest rates than platforms with floating rates
  • Relatively new market player, launched in June 2021
Via Notional Finance’s Website

Notional Finance is a rising star in the decentralized finance space offering fixed interest rates for various investment products. The platform launched in June 2021 in New York. It is an Ethereum-based service provider that allows users to participate in the governance and future development of the products through a dedicated governance portal.

What Is Notional Finance?

Notional Finance is a decentralized finance platform on the Ethereum blockchain that offers a variety of investment tools. One of the main benefits the platform provides to its users is fixed interest rates on all services it offers. This is a revolutionary approach for the DeFi space that allows users to plan and predict their earnings potential from the very start of the loan or borrowing term.

With Notional Finance, users can borrow, lend, stake, and provide liquidity for several Ethereum-based currencies, including DAI, ETH, USDC, and WBTC. The platform also introduces an innovative tokenization mechanic for assets and obligations called fCash.

Notional Finance website
Fixed Interest Rate (APY)Additional BenefitsFees
BorrowETH – 3.08%, DAI – 1.87%, USDC – 3.17%, WBTC – 0.79%No penalty for early terminationNo platform fees
Possible gas fees
LendETH – 3.95%, DAI – 3.22%, USDC – 4.37%, WBTC – 1.25%No penalty for early terminationNo platform fees Possible gas fees
StakeNOTE – 66.52%Trading fee returns
Notional buyback returns
No platform fees Possible gas fees
Provide LiquidityETH – 8.06%, DAI – 4.58%, USDC – 5.72%, WBTC – 0.19%NOTE incentives for all liquidity poolsNo platform fees Possible gas fees

The Benefits Of Notional’s Fixed Rates

The DeFi space is riddled with investment opportunities boasting high but variable interest rates. More often than not, such promises are unfounded, and the interest rates drop significantly following a pre-determined initial period.

Notional Finance aims to eradicate these fluctuations in interest rates and offer investors a secure and stable return on their investment. Unlike floating interest rates, fixed terms offer investors the opportunity to plan their returns and see the actual value of their earnings before the end of the loan term.

Fixed Vs. Floating Interest Rates

Fixed InterestFloating Interest
RatesUsually lower but remain the same throughout the loan termUsually start off in the high bounds but gradually diminish over time, reaching lower values than with fixed rates
Security Of investmentInvestors can plan and see the returns they will get after the term endsThere is no way to predict the fluctuation of the rates and the final value of the returns

How Does Notional Finance Work?

Notional Finance is a decentralized finance platform that offers a wide range of investment products like crypto loans, staking, and liquidity provision. Powered by smart contracts on the Ethereum blockchain, the platform is completely decentralized, allowing users to vote on improvement proposals and updates.

What is more, Notional Finance employs a revolutionary tokenization principle in the form of fCash. fCash represents the assets and obligations resulting from different products in the form of cryptocurrency tokens. Users have a negative or positive fCash balance depending on the products they are using and the amount of money they lend or borrow through Notional Finance. This revolutionary mechanism allows investors to track their borrowings and lendings on Notional Finance easily.

Notional Finance Products

Notional Finance offers a wide variety of decentralized finance products. The platform is suitable for lenders and borrowers alike, as well as investors looking to offer liquidity or stake their assets for passive income.

Notional Borrow

Borrowing cryptocurrency assets on Notional Finance allows users to boost their liquidity. By using crypto to back your borrowing claim, you can take advantage of Notional Finance’s fixed-interest loans. What is more, the platform does not charge any fees for early repayment on its loans.

Notional Finance Borrow

Notional Lend

If you are looking to lend out your crypto assets and earn interest on them, Notional Finance has you covered. The platform offers fixed-interest rates and supports several Ethereum-based cryptocurrencies, including DAI, ETH, USDC, and WBTC.

Notional Finance overview of apy

Notional Liquidity

Providing liquidity on Notional Finance is a great way to boost your passive income. Aside from earning variable interest rates on the cryptocurrency tokens you lock up in liquidity, you also receive additional incentives in NOTE tokens. What is more, you can borrow additional funds against the liquidity provider tokens you receive when locking up funds in Notional Finance liquidity pools.

Notional Finance Liquidity

Staking NOTE

Staking Notional Finance’s native token NOTE can bring you yearly interest rates of up to 67.6%. This is a great way to make your assets work passively in your favor. The staking mechanism on the platform requires users to lock up NOTE and ETH in an 80/20 balance. Rewards are paid out in NOTE tokens, and there is an unstaking lock-up period of 15 days.

Notional Finance Staking

Leveraged Vaults

Leveraged Vaults is an upcoming product release on the Notional Finance platform that aims to bring even higher returns to investors. The goal behind this product is to combine the lending and borrowing the platform facilitates and pool the funds in a vault, effectively increasing capital efficiency for users.

Notional Finance leveraged vaults

What Regions Are Supported?

Notional Finance is available worldwide with the following exceptions:

  • New York
  • Cuba
  • Iran
  • Syria
  • North Korea
  • the Crimea region
  • Venezuela

What Wallets Are Supported?

Notional Finance supports eight cryptocurrency wallets:

Notional Finance Fees

Notional Finance does not charge any fees for the utilization of its products. The only fees users might have to pay are gas fees required for transaction approval on the Ethereum blockchain.

How To Sign Up For Notional Finance

Signing up to use Notional Finance is as easy as connecting your wallet to the platform. There is no need to register with your email or create a password. Your wallet is your login.

Step 1: Visit Notional Finance and launch the Notional Finance app.

Notional Finance App

Step 2: Connect your crypto wallet to the platform.

Notional Finance App connect wallet

How To Borrow On Notional

Once you’ve connected your wallet to the platform, you can start using its products. Read on to find out how to borrow on Notional Finance.

Step 1: Select the “Borrow” product on the left-hand side of the screen.

notional finance borrow

Step 2: Select the cryptocurrency you would like to borrow. We will choose ETH for this example.

Notional Finance select crypto to borrow

Step 3: Select the amount of ETH you would like to borrow and the maturity date of your loan.

Notional Finance select loan amount

Step 4: Select the collateral you are going to put up for your loan and decide how much risk you want to assume with your loan.

Notional Finance choose collateral

Step 5: Confirm your trade and wait for the funds to be deposited into your wallet. You will need to enable Notional Finance to withdraw funds from your wallet for the collateral deposit amount.

Notional Finance confirm borrow order

How To Lend On Notional

Lending on Notional Finance is just as easy as borrowing once your wallet is connected to the platform.

Step 1: Select the “Lend” product on the left-hand side of the screen.

Notional Finance how to lend

Step 2: Select the cryptocurrency you would like to lend. For this example, we will use ETH.

Notional Finance select lending cryptocurrency

Step 3: Select the amount of ETH you would like to lend and choose the maturity term of your lending contract.

Notional Finance select lending amount

Step 4: Confirm the trade and make sure to note how much fCash will be minted as interest on your loan. Click “Submit” to finalize the lending procedure.

Notional Finance confirm lend order

How To Provide Liquidity On Notional

Providing liquidity on Notional Finance happens in just a few clicks. Follow the instructions below:

Step 1: Click on the “Provide liquidity” product on the left-hand side of your screen.

Notional Finance provide liquidity

Step 2: Select the cryptocurrency you want to provide liquidity with. For this example, we will use ETH.

Notional Finance select liquidity asset

Step 3: Select the amount of ETH you would like to lock up in the liquidity pool.

Notional Finance select liquidity amount

Step 4: Confirm the trade and check the amount of nETH that will be minted from your liquidity.

Notional Finance confirm liquidity trade

Step 5: If you are happy with the rates, click “submit” to finalize the liquidity provision process.

How Does The fCash Token Work?

fCash is the innovative mechanism Notional Finance uses to tokenize payments in different currencies like ETH or USDC at specific points in the future. fCash balances can be positive and negative depending on the type of product you are using.

If you are lending money through Notional Finance, you will have a positive fCash balance, which represents the cryptocurrency you will get back when the loan contract reaches maturity.

Suppose you are borrowing money through Notional Finance. In that case, you will have a negative fCash balance, which represents the cryptocurrency you will have to pay back by the time your borrowing contract reaches maturity.

Notional Finance how does the fCash token work

Notional Finance Security Features

Notional Finance regards security as one of its top priorities. In order to ensure the safety of its customers’ assets, the platform has the following security measures in place.

Frequent Security Audits

Notional Finance undergoes regular security audits from third-party firms in order to ensure that the platform abides by the latest security practices.

No Dedicated Wallet

The platform does not support a dedicated in-house wallet in order to avoid centralized storage of funds. This is why users connect with their personal wallets and operate with assets stored there. Notional Finance chose to operate in that way to protect customer assets and ensure better safety on the platform.

Notional Finance Review And Final Thoughts

Notional Finance is an up-and-coming decentralized finance platform offering unprecedented security on investment in the space. With fixed interest rates, the platform revolutionizes the DeFi space by bringing predictability to investors. While the platform is still rather new, launched only a year ago, it has already established itself as a reliable investment partner.

Frequently Asked Questions

Notional Finance is a proven DeFi provider in the crypto industry with solid security practices in place. The company undergoes frequent third-party audits and is a registered business entity in the United States.

In May 2021, Notional Finance went through a successful Series A funding round, which generated over $10 million in funding.

The funding round attracted a number of leading venture capital firms, including industry leaders like Coinbase Ventures.

Notional Finance’s main base of operation is located in New York.

Notional Finance has an extensive Bug Bounty program which ensures that the platform and its smart contracts are protected and work as intended. Developers are rewarded for finding potentially threatening bugs in the platform’s underlying code. The Notional Finance Grants program is an open-to-all DeFi support program that aims to support new developments in the space.

Notional Finance does not report directly to the IRS. Users who take advantage of the platform’s products need to fill out their IRS reports separately.

Hristina Yordanova
Hristina Yordanova
Hristina Yordanova is an experienced cryptocurrency journalist with numerous works published in leading outlets like CoinMarketCap and DappRadar. She is passionate about the web3 space, DeFi, and NFTs.
Shannon Ullman
Shannon Ullman
Managing Editor
Managing editor working to make crypto easier to understand. Pairing editorial integrity with crypto curiosity for content that makes readers feel like they finally “get it.”

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