I’ve been working in DeFi lending for three years, and my hands-on experience using Aave and Compound over the long term has shaped a deeply ingrained industry-inertia way of thinking. When I looked through the official system documentation at @TermMax , I repeatedly studied and cross-checked it. I found that the “GT” used to support borrowing positions is built on the “ERC721” standard as an NFT asset—rather than the “ERC20” fungible tokens commonly used across the industry. This counterintuitive product design initially left me quite puzzled #TermMax
What truly made me understand the value of this underlying design was a previous experience I had with a botched leverage operation. At the end of last year, in order to set up my target leverage position, I repeatedly performed “looping loan nesting” operations in a traditional lending protocol to build my position—completing multiple borrow and deposit actions. The entire process consumed a great deal of my time and energy. Each on-chain interaction required waiting for network confirmation and paying gas fees, and “gas estimation errors” that occurred midway caused the whole transaction to fail. Repeated retries not only took a long time, but also resulted in very high transaction costs.
Only after I gained a deep understanding of TermMax’s entire token system did I finally come to full realization. The protocol establishes a complete coordinated logic among “GT,” “FT,” and “XT.” Each of the three plays a non-interchangeable role. “FT,” as a fixed-rate token, represents the debt generated by borrowing and provides the lender with a fixed, redeemable return at maturity. “XT,” as an intermediary transitional token, takes over the distribution of interest-related earnings and completes the transfer of funds in the middle layer. And “GT,” as an NFT position, packages the collateral size and all corresponding “FT” debt together—fully recording the entire leverage structure within a single vehicle. Leverage layouts that previously required multiple rounds of tedious operations can now be deployed through a single on-chain interaction, finally addressing the industry’s long-standing issues with traditional lending: “cumbersome operations and high costs.”
As I kept thinking deeper, I gradually realized that real financial borrowing itself is not truly fully fungible. The interest rate of each borrowing asset configuration period varies from one deal to another, and the risk conditions are completely independent as well. The monolithic accounting approach used by traditional protocols seems convenient, but it hides the differentiated risk of each individual debt and lacks the core capability of “fine-grained risk control.”
What truly made me understand the value of this underlying design was a previous experience I had with a botched leverage operation. At the end of last year, in order to set up my target leverage position, I repeatedly performed “looping loan nesting” operations in a traditional lending protocol to build my position—completing multiple borrow and deposit actions. The entire process consumed a great deal of my time and energy. Each on-chain interaction required waiting for network confirmation and paying gas fees, and “gas estimation errors” that occurred midway caused the whole transaction to fail. Repeated retries not only took a long time, but also resulted in very high transaction costs.
Only after I gained a deep understanding of TermMax’s entire token system did I finally come to full realization. The protocol establishes a complete coordinated logic among “GT,” “FT,” and “XT.” Each of the three plays a non-interchangeable role. “FT,” as a fixed-rate token, represents the debt generated by borrowing and provides the lender with a fixed, redeemable return at maturity. “XT,” as an intermediary transitional token, takes over the distribution of interest-related earnings and completes the transfer of funds in the middle layer. And “GT,” as an NFT position, packages the collateral size and all corresponding “FT” debt together—fully recording the entire leverage structure within a single vehicle. Leverage layouts that previously required multiple rounds of tedious operations can now be deployed through a single on-chain interaction, finally addressing the industry’s long-standing issues with traditional lending: “cumbersome operations and high costs.”
As I kept thinking deeper, I gradually realized that real financial borrowing itself is not truly fully fungible. The interest rate of each borrowing asset configuration period varies from one deal to another, and the risk conditions are completely independent as well. The monolithic accounting approach used by traditional protocols seems convenient, but it hides the differentiated risk of each individual debt and lacks the core capability of “fine-grained risk control.”
