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      • Fixed Rate Tokens minting process
      • Fixed Rate Tokens Pricing
    • Loan Tokens
    • Fixed Rate Pools
      • Limit Orders
      • Lend Fixed
      • Borrow Fixed
      • Adding liquidity
      • Market making examples
      • Fees
    • Fixed Rate Markets
      • Examples
    • Collateral Framework
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    • Liquidations
      • Collateral Liquidations
      • Fixed Token Liquidations
      • LP Token Liquidations
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Last updated 4 months ago

The Tenor protocol is constituted of instances that market curators can use to deploy fixed rate markets on top of money markets from protocols such as Euler and Morpho.

Curators who list fixed rate markets on top of their own money markets enhance the utility of their markets by allowing users to opt in to a fixed-rate lending or borrowing experience. Additionally, market curators can structure their fixed rate markets so that the Total Value Locked (TVL) in the fixed-rate market entirely flows down to their money markets. Fixed rate market curators also benefit from receiving part of the fees generated on all lending and borrowing transactions. Furthermore, they generate fees from excess Oracle Extractable Value (OEV) captured during liquidations. These fees incentivize market curators to list fixed rate markets.

Fixed Rate Markets

By default, fixed rate markets are isolated from one another. After the deployment of a fixed rate market by a market curator, they can simply list fixed rate trading pools of varying maturity dates. Multiple pools of different maturities can be listed under the umbrella of a single fixed rate market, with all pools adhering to the same parameters within a specific market, making them simple to deploy.

Each fixed rate market is characterized by a set of collateral assets (e.g., WBTC, wstETH, WETH) and one loan currency (e.g., USDC). The parameters defining fixed rate markets include:

  • Collateral Assets (ex: WBTC, wstETH, WETH)

  • Loan Token (ex: USDC)

  • Money Market Loan Token (ex: cUSDC)

  • Maximum LTVs (ex: 0.80, 0.82, 0.84)

  • Liquidation discounts (ex: 1.05, 1.05, 1.04)

  • Oracle addresses

  • Maximum market length (ex: 1 year)

  • Number of fixed interest rate ticks (ex: 100 ticks)

  • Maximum fixed interest rate tick (ex: 25%)

  • Supply caps

Fixed rate markets inherit and track the money market risk parameters (e.g., Collateral Assets, Loan Token, Maximum LTVs, Liquidation discounts, Oracles). This is necessary for the fixed rate market users to seamlessly settle to the underlying money market after maturity.

Fixed Rate Market Actions

Each Fixed Rate Market allows users to execute the following actions:

Borrowers

  • Add collateral

  • Remove collateral

  • Borrow at a fixed interest rate

  • Set a fixed interest rate borrow limit order

Lenders

  • Lend at a fixed interest rate

  • Set a fixed interest rate lend limit order

Market Makers (LP)

  • Set lend and borrow limit order across a set of pools simultaneously

  • Add liquidity in a given market across a range

Liquidators

  • Liquidate unhealthy accounts

  • Fixed Rate Markets
  • Fixed Rate Market Actions
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  1. Protocol Design

Fixed Rate Markets