Lender First Pool

In this pool variant, lenders create pools with custom terms and seed it with lend funds. After the pool has been deployed, any number of borrowers can borrow from the pool until the funds have been depleted. The borrowers have until the repayment due date to repay. If they do not, they default their collateral but keep their loan. Partial repays are also supported. Once the pool has expired, lenders can collect all remaining tokens in the pool including the interest they have received.

As a borrower, it is recommended to default your collateral to the lender if the pool's LTV is > 100% as that would indicate the value of your loan has surpassed the value of your deposited collateral.

User Actions

Once a lender has deployed a pool, the lender can:

Once a lender has deployed a pool, anyone seeking to borrow can:

Terms

As a pool creator (lender), you will be able to set the below terms when deploying your lending pool.

Pool Terms

Pool Rate

While you have the flexibility to choose any APR you prefer, it is advisable to opt for a sensible rate. Doing so will attract borrowers more effectively to utilize your pool for borrowing.

Fees Involved

Borrower fees

*Both fees are applied when rolling debt over between pools

Example:

Protocol fee = 0.3%

Loan APR (interest rate) = 1%

1) Borrower takes loan of 1000 USDC

  • 1000 * 0.3% = 3 USDC -> Sent to protocol treasury

  • 1000 * 1% = 10 USDC -> Remains in pool to be collected by lender after repayment due date

  • 1000 - 3 - 10 = 987 USDC -> Sent to borrower

*Borrower fees are subject to change if deemed necessary

Lender Fees

The lender incurs no fees.

Rollovers

A rollover pool is the same as any other pool that is created. The only difference is the rollover pool has a further out expiry and the lender must whitelist it. Additionally, a rollover pool must be deployed from the same address you deployed the original pool with.

The collateral and lend token of a new pool must be the same as in the origin pool for the new pool to be considered a rollover pool. The Lend Ratio, Interest Rate and Expiry can be different from the prior pool!

Example:

1) Lender creates WETH<>USDC pool with repayment due date of May 1st (pool A)

2) Borrower borrows from pool A

3) Lender creates new WETH<>USDC pool with repayment due date of June 1st (pool B)

4) Lender whitelists pool B from pool A to allow borrowers from pool A to rollover their debt into pool B, thereby extending their loan.

5) Borrower rolls their debt over from pool A to pool B, effectively granting them a loan extension to June 1st. At this point, the borrowers debt and collateral are associated with pool B, so any future repayments will be done in pool B.

To add your new pool to the rollover list, go to the "My Pools" tab, select the desired pool, then click on the "Set Rollover" tab under Deployed Pool Options. You'll see a list of eligible rollover pools.

Once enabled, borrowers from your origin pool can rollover their debt from the origin pool to the destination pool.

Undercollateralized Borrowing Protection

Oracle Protection, as indicated in the pool terms section, allows lenders to activate or deactivate undercollateralized lending. If the tokens within your pool are linked to an oracle, our Vendor lending pools possess the capability to automatically halt borrowing if the value of the lend tokens exceeds the collateral amount that a borrower wants to deposit. This serves as a safeguard for situations where the prices of the pool tokens experience price fluctuations, and protect lenders from losing money.

Note:

Lenders retain the option to manually pause their pools whenever desired, accessible through the "My Pools" tab. The oracle check is performed precisely at the moment a borrowing transaction is initiated.

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