I initially assumed a fixed rate lending protocol would calculate one protocol wide rate for each market.
@TermMax Range Order Tool points to a different model.
Market makers can create lending only, borrowing only or two way quotes, then define the pricing curve and the range where their liquidity is active. The V2 order contract reflects this directly through functions such as createOrder and setCurveAndPrice.
That means the rate shown to a user is not simply the TermMax rate.
It is the price produced by available liquidity, the maker’s chosen curve, the order range and the size of the trade.
I find that more interesting than a fixed formula because different maturities and collateral markets do not necessarily need the same pricing shape.
A market maker can concentrate liquidity near the rates where they are actually willing to lend or borrow instead of funding an entire curve.
But customization does not automatically create a good market.
If only a few makers are quoting, a displayed rate can look precise while meaningful size moves quickly into a worse range. The tool provides control; it cannot guarantee competing liquidity.
The numbers I would watch are not only headline APRs.
I would look at quote depth, spreads, overlapping ranges and how much size can trade before the rate changes materially.
A fixed rate can be known in advance.
That does not mean the market producing it is deep.
#TermMax
What best proves a fixed rate market has real depth?