#termmax
btc zoii day 5
Anyone who has tried to plan around DeFi yield knows the awkward part isnot the number its the variance. A vault paying 12% in January and 6% in March hasnot necessarily done anything wrong but it has made your spreadsheet useless twice. Real obligations donot reprice themselves to match. Rent subscriptions whatever you hve committed to monthly all of it assumes a figure you wrote down at some point and expected to hold. So you end up recalculating the same plan over and over and the Recalculating is the actual cost not the lower APY.
TermMax addresses This by fixing the rate at entry. When you lend you receive FT which is structurally a zerocoupon instrument: you know the amount and you know the date it settles. Worth being precise about what that does and doesnot give you because I have seen it described as predictable income and thats not quite right. FT doesnot pay you along the way. It pays once at maturity. If what you actually want is something resembling recurring cash flow you have to construct it the way fixed income Desks always have, by staggering maturities so the payouts land at different points rather than stacking on one date. Thats a portfolio decisionnot a protocol feature and it the part most explanations skip.
The other half of it is What happens to capital that hasnot been matched yet. On most fixed rate designs committing to a rate means waiting for a counterparty and eating the opportunity cost while you wait. TermMax routes unfilled limitorder capital into whatever Base yield source the curator selected an Aave market or an ERC 4626 vault so the waiting period earns something instead of nothing. I donot think this is the Geadline feature but it removes the main practical objection to using fixed rate lending at all which is that you pay for certainty twice once in a lower rate and again in idle time.
None of this makes yield predictable in the sense people usually mean. It makes one number Predictable on one date for the portion you have committed.
@TermMax #TermMax
btc zoii day 5
Anyone who has tried to plan around DeFi yield knows the awkward part isnot the number its the variance. A vault paying 12% in January and 6% in March hasnot necessarily done anything wrong but it has made your spreadsheet useless twice. Real obligations donot reprice themselves to match. Rent subscriptions whatever you hve committed to monthly all of it assumes a figure you wrote down at some point and expected to hold. So you end up recalculating the same plan over and over and the Recalculating is the actual cost not the lower APY.
TermMax addresses This by fixing the rate at entry. When you lend you receive FT which is structurally a zerocoupon instrument: you know the amount and you know the date it settles. Worth being precise about what that does and doesnot give you because I have seen it described as predictable income and thats not quite right. FT doesnot pay you along the way. It pays once at maturity. If what you actually want is something resembling recurring cash flow you have to construct it the way fixed income Desks always have, by staggering maturities so the payouts land at different points rather than stacking on one date. Thats a portfolio decisionnot a protocol feature and it the part most explanations skip.
The other half of it is What happens to capital that hasnot been matched yet. On most fixed rate designs committing to a rate means waiting for a counterparty and eating the opportunity cost while you wait. TermMax routes unfilled limitorder capital into whatever Base yield source the curator selected an Aave market or an ERC 4626 vault so the waiting period earns something instead of nothing. I donot think this is the Geadline feature but it removes the main practical objection to using fixed rate lending at all which is that you pay for certainty twice once in a lower rate and again in idle time.
None of this makes yield predictable in the sense people usually mean. It makes one number Predictable on one date for the portion you have committed.
@TermMax #TermMax
