TermMax also has a Leverager mechanism for creating leveraged positions.
The Leverager uses borrowed debt tokens to purchase more of the collateral asset. The purchased collateral is then locked into a Gearing Token.
During this process, TermMax uses a flash loan. The funds are used to purchase collateral, and the resulting position is used to repay the flash loan within the same transaction.
The final GT represents the leveraged position, including its collateral and debt.
I want to watch how this mechanism works in practice.
One mechanism in TermMax that is worth understanding is what happens when a loan reaches a liquidation event.
Liquidation can be triggered when a loan reaches its LLTV threshold. If a borrower does not repay by maturity, the loan also becomes available for liquidation.
If the loan remains unpaid after the liquidation window, TermMax uses physical delivery. FT holders can redeem through a pool containing both underlying and collateral tokens, receiving a proportional distribution.
TermMax Vaults allow users to deposit assets while a Curator manages the capital by placing range orders across selected markets. Depositors receive vault shares representing their proportional ownership.
The interesting part is that Vaults allow capital to be managed across markets through a defined strategy.
Curators also operate with controls such as market whitelisting, capacity limits, timelocks, and guardian oversight.
I find interesting is how borrowing positions are structured in TermMax.
When a borrower locks collateral into a Gearing Token (GT), TermMax issues Fixed-Rate Tokens (FTs) based on the market’s maximum LTV. The FT represents the debt obligation, while the GT records the collateral and debt.
That made me look at TermMax differently: The collateral and debt are represented through separate on-chain components rather than one simple loan balance.
Another detail matters here: If collateral value falls enough for the position’s LTV to reach the liquidation threshold, liquidation can be triggered.
The real part I want to watch is how these positions behave when collateral prices move quickly.
TermMax is a decentralized lending protocol focused on fixed-rate lending and borrowing. It helps users access predictable yields and manage DeFi strategies with more certainty.
TermMax is changing the way DeFi lending works.
Fixed-rate lending, borrowing, and leverage across multiple chains — giving users more predictable outcomes instead of constantly changing rates.
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