I've been digging into TermMax's fixed-rate system, and the mechanics are straightforward once you run the numbers yourself.
Say I lock 1 ETH, worth $1,000, into a GT — an NFT that wraps my collateral and debt into one position. At an 80% loan-to-value cap, I can mint up to 800 FTs. I sell them at a discount, $0.80 each, and get $640 USDC in hand immediately. At maturity, I repay 800 USDC and get my ETH back. That's it.
The token math: 1 FT + 1 XT = 1 debt token. Always. FT is a zero-coupon bond — buy cheap, redeem at face value, fixed yield locked in from day one. XT is the interest leg. It keeps the system priced correctly, then expires worthless once FTs get redeemed at maturity. GT just holds the collateral and debt logic underneath.
Compared to floating-rate lending on Aave or Compound, the certainty here is the real selling point — I know my cost upfront, no surprises mid-term.
But I'm not fully sold yet. TVL is still thin next to the bigger money markets, and fixed-rate protocols live or die on secondary market liquidity for FTs and XTs. If that dries up near maturity, exits get expensive fast.
The design solves a real gap in DeFi. Whether it scales is still an open question.
@TermMax #TermMax
Say I lock 1 ETH, worth $1,000, into a GT — an NFT that wraps my collateral and debt into one position. At an 80% loan-to-value cap, I can mint up to 800 FTs. I sell them at a discount, $0.80 each, and get $640 USDC in hand immediately. At maturity, I repay 800 USDC and get my ETH back. That's it.
The token math: 1 FT + 1 XT = 1 debt token. Always. FT is a zero-coupon bond — buy cheap, redeem at face value, fixed yield locked in from day one. XT is the interest leg. It keeps the system priced correctly, then expires worthless once FTs get redeemed at maturity. GT just holds the collateral and debt logic underneath.
Compared to floating-rate lending on Aave or Compound, the certainty here is the real selling point — I know my cost upfront, no surprises mid-term.
But I'm not fully sold yet. TVL is still thin next to the bigger money markets, and fixed-rate protocols live or die on secondary market liquidity for FTs and XTs. If that dries up near maturity, exits get expensive fast.
The design solves a real gap in DeFi. Whether it scales is still an open question.
@TermMax #TermMax