Reference

Glossary

Every term used in these docs, defined once.

Terms used across this documentation, grouped by theme. Definitions describe how each term is used here, which may be narrower than its general meaning.

A token that tracks the price of a listed stock, created and controlled by an issuer. It is not the share itself. The rights of a holder are defined by the issuer's terms, and the issuer can pause, block, force-burn or upgrade the token.

USDG

The US dollar stablecoin that the pool accepts as deposits, uses to repay debt and uses as its unit of account. It is an issued asset and carries issuer risk of its own.

LLTV

Liquidation loan-to-value. The ratio of debt to collateral value above which a loan can be liquidated. It is set by the lending market, not by Blotter.

Liquidation bonus

The extra collateral a lending market gives to a liquidator, on top of the value of the debt repaid. It is the source of the pool's gross premium. See Liquidation flow.

Permissionless liquidation

A liquidation function that any address can call on any liquidatable loan, without registration or allowlist. Morpho Blue-style markets work this way, which is why the pool needs no integration from the lending market.

Bad debt

Debt that remains after all of a loan's collateral has been seized. It is a loss for the lending market and its lenders. Blotter does not cover it.

Prices and sessions

Oracle heartbeat

The maximum expected interval between two updates of a price feed while the market is open. The pool uses it to decide whether a price is fresh.

Stale feed

A feed whose last update is older than its heartbeat. The pool neither seizes nor unwinds against a stale feed.

The print

The first oracle price published when the underlying market reopens, most notably on Monday at 9:30 Eastern Time. It is the moment when a gap becomes visible to lending markets.

The bell

Shorthand for the regular trading session, which runs between the opening bell at 9:30 and the closing bell at 16:00 Eastern Time. "Sell at the bell" means selling only while the underlying market is open.

Halt

A suspension of trading, either in one stock or across the market through a circuit breaker. The feed for the affected tickers freezes until trading resumes. The pool does not unwind during a halt.

Gap

The difference between the last price before a market close or halt and the first price after it. Gaps on carried inventory are the pool's main source of loss.

Cascade

A feedback loop in which liquidations push the on-chain price down, and the lower price causes or delays further liquidations. See The Monday problem.

Trading

Constant-product AMM

An automated market maker that keeps the product of its two reserves constant. The price moved by a trade depends on the size of the trade relative to the reserve.

Price impact

The change in the AMM's price caused by a trade, as a fraction of the price before the trade.

Slippage

The difference between the price before a trade and the average price actually obtained. For the pool, it is a direct cost of unwinding.

Tranche

One sale of inventory on the AMM. Each tranche is capped as a percentage of the AMM's volume and reserve, and is sent only during market hours.

The pool

Warehouse

The inventory of seized Stock Tokens that the pool holds and has not yet sold. It is valued at the oracle price. See Warehouse and unwinding.

ERC-4626

The Ethereum standard for tokenized vaults. It defines deposit, mint, withdraw, redeem, totalAssets, the conversion functions and maxWithdraw. Shares are transferable ERC-20 tokens.

NAV

Net asset value. For the pool, free USDG plus the warehouse at oracle value. It is the figure returned by totalAssets.

NAV divided by the share supply. It rises with premiums collected and falls with slippage and with declines in the oracle price of held inventory. See Pool shares.

Withdrawal queue

The list of withdrawal requests that exceed the pool's free USDG. A set share of the pool's assets always stays in free USDG and cannot be spent on liquidations; requests beyond it wait in the queue, which is filled as unwind tranches bring USDG back.