#termmax
Fixed-rate DeFi stays abstract until someone runs the numbers, so here's the worked example straight out of the @TermMax docs.
Market: USDC debt, ETH collateral, 1-year maturity, max LTV 0.8.
๐งฎ Borrower side โ Alice locks 1 ETH at $1,000 into a GT. At 0.8 MLTV she mints 800 FT, meaning 800 USDC of debt. She sells that FT at a 20% discount, $0.80 each, and walks away with $640 today. Her cost is set. No reprice, no drift.
๐งฎ Lender side โ deposit 640 USDC, receive 640 FT + 640 XT, and the contract swaps the XT into 160 more FT. Total 800 FT, each redeemable for 1 USDC at maturity โ $800 back. Roughly 25% on the entry, decided on day one.
๐งฎ The part most people skip โ Alice can repay in FT instead of USDC. If FT still trades near $0.80, buying 800 back costs about $640 to clear an 800 USDC debt. The discount cuts both ways.
That third point is what changed how I read these markets. A borrower isn't only paying a rate, they're holding a position against their own debt token.
To be clear, the 20% discount above is the docs' illustration, not a live rate โ real discounts are whatever the curve and curators offer at that moment. And a fixed term means your capital has a date attached: exiting early means selling FT at market. $TMX
Fixed and locked for the term, or floating and free to leave whenever?
Fixed-rate DeFi stays abstract until someone runs the numbers, so here's the worked example straight out of the @TermMax docs.
Market: USDC debt, ETH collateral, 1-year maturity, max LTV 0.8.
๐งฎ Borrower side โ Alice locks 1 ETH at $1,000 into a GT. At 0.8 MLTV she mints 800 FT, meaning 800 USDC of debt. She sells that FT at a 20% discount, $0.80 each, and walks away with $640 today. Her cost is set. No reprice, no drift.
๐งฎ Lender side โ deposit 640 USDC, receive 640 FT + 640 XT, and the contract swaps the XT into 160 more FT. Total 800 FT, each redeemable for 1 USDC at maturity โ $800 back. Roughly 25% on the entry, decided on day one.
๐งฎ The part most people skip โ Alice can repay in FT instead of USDC. If FT still trades near $0.80, buying 800 back costs about $640 to clear an 800 USDC debt. The discount cuts both ways.
That third point is what changed how I read these markets. A borrower isn't only paying a rate, they're holding a position against their own debt token.
To be clear, the 20% discount above is the docs' illustration, not a live rate โ real discounts are whatever the curve and curators offer at that moment. And a fixed term means your capital has a date attached: exiting early means selling FT at market. $TMX
Fixed and locked for the term, or floating and free to leave whenever?
๐ Lock the rate take the date
0%
๐ช I need to exit anytime
0%
๐งฎ Depends on the discount
0%
๐ Still learning FT/XT
100%
1 votes โข Voting closed