# Operation fee calculation

When an operator submits tx deposit_strategy or withdraw_strategy (when assets are rebalanced between lending protocols), we call this the rebalance crank.

Fee is collected to the fee_vault every time the operator sends a rebalance crank. This fee is shown in the fee_vault address as vault LP SPL tokens.

We are currently charging 5% of profit as the operation (performance) fee. Before jumping into the formula, we define some variables:

Before rebalance:

vault.total_amount : t1

lp_mint.total_supply: p1

virtual_price (value of lp token): v1 =t1/p1

After rebalance:

vault.total_amount : t2

lp_mint.total_supply: p1

virtual_price: v2 =t2/p1

We charge operation fee:

Virtual price after fee:

Vault doesn't send the token directly to the treasury token account (because vault may not have enough liquidity), so vault mint more lp tokens for fee_vault. Assuming vault mints more **delta** lp tokens, then the new virtual price:

We still ensure the virtual price in (1) and (2) are the same v21=v22, so

Then we can calculate how many lp tokens is minted more for each rebalance crank:

Or

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