People are depositing into TermMax this week to finish Booster tasks before August 24. Most of that is lending. So this is the clause worth reading first.
FT is presented as a zero coupon bond. Buy at a discount, hold to maturity, redeem one for one.
The liquidation page describes what happens when that does not go cleanly. After maturity there is a two hour window for liquidators, carrying a 10% penalty split evenly between the liquidator and the protocol reserve. If anything is still unpaid or only partly liquidated when the window closes, physical delivery begins automatically.
At that point FT holders redeeming through the pool receive a proportional distribution of underlying and collateral tokens based on their shares.
The claim does not fail. It converts. A fixed number becomes a slice of whatever sat behind the loans that did not close.
The Risks page states this directly, that liquidated value may not fully cover principal plus interest and that delivery may hand you assets different from those you deposited.
What makes it worth sitting with is the collateral mix. Pendle PT tokens are a core collateral type on Ethereum, and those carry their own maturities and their own liquidity conditions.
@TermMax
My expectation. The first meaningful test of this path comes from a PT market rather than a WETH or WBTC one, because that is where the exit bid thins first.
Two hours is the window. Is that long enough for a liquidator to want the collateral you are holding?
#TermMax
FT is presented as a zero coupon bond. Buy at a discount, hold to maturity, redeem one for one.
The liquidation page describes what happens when that does not go cleanly. After maturity there is a two hour window for liquidators, carrying a 10% penalty split evenly between the liquidator and the protocol reserve. If anything is still unpaid or only partly liquidated when the window closes, physical delivery begins automatically.
At that point FT holders redeeming through the pool receive a proportional distribution of underlying and collateral tokens based on their shares.
The claim does not fail. It converts. A fixed number becomes a slice of whatever sat behind the loans that did not close.
The Risks page states this directly, that liquidated value may not fully cover principal plus interest and that delivery may hand you assets different from those you deposited.
What makes it worth sitting with is the collateral mix. Pendle PT tokens are a core collateral type on Ethereum, and those carry their own maturities and their own liquidity conditions.
@TermMax
My expectation. The first meaningful test of this path comes from a PT market rather than a WETH or WBTC one, because that is where the exit bid thins first.
Two hours is the window. Is that long enough for a liquidator to want the collateral you are holding?
#TermMax
