Fixed Token
Overview
Fixed Tokens are ERC-20 compliant tokens that represent the principal tokens in the Tenor protocol. Each Fixed Token can be redeemed for one unit of the underlying loan asset (e.g., USDC) at maturity in the form of Loan Tokens. Users can mint Fixed Tokens via the Market Manager contract by first depositing sufficient collateral in their account to cover the amount of Fixed Tokens they wish to mint. A healthCheck is conducted after mints to ensure that accounts are overcollateralized.
After maturity, any account can call the settle() method to capture the exchange rate between 1 unit of the loan asset (e.g., USDC) and the value of Loan Tokens. This settlementExchangeRate enables Fixed Token holders to redeem their Fixed Tokens for Loan Tokens at that rate.
Key Features
| Feature | Description |
|---|---|
| ERC-20 Compliance | Standard token functionalities including transfers, balances, and allowances |
| ERC20Permit (EIP-2612) | Gasless approvals using off-chain signatures |
| Controlled Issuance | Minting and burning restricted to authorized Market Manager and Loan Token contracts |
| Maturity | Fixed date after which settlement exchange rate is captured and Fixed Tokens become convertible to Loan Tokens |
| Settlement | Post-maturity settlement exchange rate determines redemption ratio between Fixed Tokens and Loan Tokens |
Core Functions
Minting
function mint(address to, uint256 amount) external
- Only callable by Market Manager
- Must occur before the maturity date
- Mints tokens to the specified address
Burning
function burn(address from, uint256 amount) external
- Only callable by Loan Token or Market Manager
- Burns tokens from holder's balance
- Used for redemption and settlement of Fixed Tokens after maturity
Settlement
function settle() external returns (ExchangeRate exchangeRate)
- Calculates and snapshots the redemption exchange rate between Fixed Tokens and Loan Tokens
- Callable once after maturity by anyone (called within settleFixed and settleDebt methods)
- Rate determined by loan asset to Loan Token exchange rate
Note: The settlement exchange rate may be captured at a timestamp later than maturity. Until this rate is captured, Fixed Token holders (lenders) don't accrue the Morpho reference money market variable rate, and borrowers don't pay the variable rate on their matured debts.