After finishing the TermMax mechanism documentation, I finally saw clearly how the fixed interest rate is embedded into the entire protocol. The borrower locks the collateral into GT, mints FT according to the MLTV cap, then splits the FT into principal and interest components. The interest component is sold to Lending Range Order in exchange for XT, and finally the borrower uses XT plus the principal component to redeem the debt token. The fixed rate @TermMax is not a number calculated after the fact—it is locked in at the exact moment the assets are split and exchanged.
Range Order is the part worth studying the most. It consists of a continuous order set that forms a pricing curve; different segments correspond to different interest rates, and the deeper the trade, the more the actually matched rate tracks the curve. I later ran through the whole process with a small amount, and when the debt tokens arrived, the displayed interest rate was almost identical to the rate range I had seen in advance. The discrepancies mainly came from slippage. That feeling of seeing it upfront and then getting paid later is much more reassuring than constantly watching a cost that jumps around in a floating-rate market. #TermMax $BTC
At normal maturity, the borrower repays the debt, and FT holders receive the maturity repayment proportionally by share. If it’s still not settled after the liquidation window ends, it moves into Physical Delivery, where lenders receive the physical collateral in proportion. The advantages are very tangible: the cost is fixed at the time of entry, and what happens in the later market doesn’t affect you. The potential risks are equally clear: the token structure is a bit complex for beginners, and if the curve depth is insufficient, the executed interest rate may deviate; physical delivery may also force someone to take over assets that are hard to sell in the short term. I’ll keep using a small position to observe for now, and I’ll keep the size within a range that I can fully understand. The mechanism has turned the fixed interest rate into a verifiable on-chain logic; the rest depends on whether real trading volume can keep it steady.
Range Order is the part worth studying the most. It consists of a continuous order set that forms a pricing curve; different segments correspond to different interest rates, and the deeper the trade, the more the actually matched rate tracks the curve. I later ran through the whole process with a small amount, and when the debt tokens arrived, the displayed interest rate was almost identical to the rate range I had seen in advance. The discrepancies mainly came from slippage. That feeling of seeing it upfront and then getting paid later is much more reassuring than constantly watching a cost that jumps around in a floating-rate market. #TermMax $BTC
At normal maturity, the borrower repays the debt, and FT holders receive the maturity repayment proportionally by share. If it’s still not settled after the liquidation window ends, it moves into Physical Delivery, where lenders receive the physical collateral in proportion. The advantages are very tangible: the cost is fixed at the time of entry, and what happens in the later market doesn’t affect you. The potential risks are equally clear: the token structure is a bit complex for beginners, and if the curve depth is insufficient, the executed interest rate may deviate; physical delivery may also force someone to take over assets that are hard to sell in the short term. I’ll keep using a small position to observe for now, and I’ll keep the size within a range that I can fully understand. The mechanism has turned the fixed interest rate into a verifiable on-chain logic; the rest depends on whether real trading volume can keep it steady.