#termmax
Liquidations are easily the ugliest part of DeFi. If a borrower defaults on a standard lending protocol, their collateral just gets market-sold on a DEX. It causes massive slippage, MEV bots feast on it, and it can trigger cascading price crashes.
Been continuing my deep dive into @TermMax , and they handle liquidations completely differently using a "Physical Delivery" system.
Instead of panic-dumping the collateral into a liquidity pool, if a loan defaults, the underlying collateral is simply delivered directly to the lender.
Here is why this is actually a massive deal for the space:
1.Zero DEX Slippage: Lenders are compensated with the actual asset without losing a huge percentage to slippage and liquidation penalties.
2 .Unlocks RWAs: Because the protocol doesn't need a deep DEX liquidity pool to dump the asset, you can use low-liquidity tokens or Real World Assets (tokenized treasuries, etc.) as collateral.
Most lending protocols are stuck only accepting high-cap tokens like ETH or WBTC because their liquidation engines demand deep liquidity. By removing the need to market-sell, TermMax is building the actual infrastructure needed to bring RWAs into fixed-rate DeFi.
#TermMax
Liquidations are easily the ugliest part of DeFi. If a borrower defaults on a standard lending protocol, their collateral just gets market-sold on a DEX. It causes massive slippage, MEV bots feast on it, and it can trigger cascading price crashes.
Been continuing my deep dive into @TermMax , and they handle liquidations completely differently using a "Physical Delivery" system.
Instead of panic-dumping the collateral into a liquidity pool, if a loan defaults, the underlying collateral is simply delivered directly to the lender.
Here is why this is actually a massive deal for the space:
1.Zero DEX Slippage: Lenders are compensated with the actual asset without losing a huge percentage to slippage and liquidation penalties.
2 .Unlocks RWAs: Because the protocol doesn't need a deep DEX liquidity pool to dump the asset, you can use low-liquidity tokens or Real World Assets (tokenized treasuries, etc.) as collateral.
Most lending protocols are stuck only accepting high-cap tokens like ETH or WBTC because their liquidation engines demand deep liquidity. By removing the need to market-sell, TermMax is building the actual infrastructure needed to bring RWAs into fixed-rate DeFi.
#TermMax