Glossary
Short definitions of the terms used in this documentation, in alphabetical order. Each entry links to the page that explains the term in depth.
B
Bad debt
Debt that remains after a position has been fully liquidated and its collateral was worth less than what was owed. The market's reserve absorbs it first, and the rest lowers the share price for lenders of that market. See Bad debt.
Blue-chip market
The market that accepts positions in the ETH/USDG, META/USDG and NVDA/USDG pools as collateral. It has the looser parameters of the two markets (max LTV up to 65%, LT up to 75%) and prices its tokens with Chainlink. See Markets.
Borrow index
A number that starts at 1 and grows every second with the borrow rate. A loan's debt is its debt shares times the borrow index, so interest is added to every loan by moving one number. See Interest rates.
C
Cash
The USDG that sits idle in a market, not lent out. Lender withdrawals and new loans are both paid from cash. See Interest rates.
Close factor
The largest share of a debt that one liquidation may repay. It is 50% in the Blue-chip market, rising to 100% when HF < 0.9 or the debt is under 100 USDG, and always 100% in the Meme market. See Liquidation mechanics.
Collateral
The Uniswap v4 liquidity position that a borrower deposits to secure a loan. The market holds the position NFT until the debt is zero. See Collateral.
Collateral value
The USD value the protocol recognises for a position when it checks borrowing limits and health: principal plus unclaimed fees (counted up to 10% of principal), reduced by the removal haircut. See Position valuation.
Crash threshold
In the Meme market, the gap between spot price and TWAP beyond which liquidations use the spot price. It is 25%: when spot is more than 25% below the TWAP, the TWAP is treated as lagging behind a real crash. See Price oracles.
D
Debt cap
The maximum total debt allowed. There is one cap per pool, set by the owner within the tier limit (up to 500,000 USDG in Blue-chip, 20,000 USDG in Meme), and one cap per market (500,000 USDG and 50,000 USDG). See Risk parameters.
Debt shares
The unit in which a loan is recorded. Your debt in USDG is your debt shares times the borrow index, so it grows as interest accrues while your shares stay the same. See Interest rates.
E
ERC-4626
The token standard for vaults that take deposits of one asset and issue shares. Each Farmenta market is an ERC-4626 vault for USDG, so lenders use the standard deposit, mint, withdraw and redeem functions. See How it works and the standard.
F
Frozen pool
A listed pool that no longer accepts new collateral, new borrowing or added liquidity. Existing loans continue: they accrue interest and can be repaid, reduced, withdrawn and liquidated. See Pool listing.
Full seizure
The liquidation outcome in which the liquidator receives the entire position and the position NFT is burned. It happens when the amount to seize reaches everything the position holds. Any debt left over becomes bad debt. See Liquidation mechanics.
G
Guardian
The account the owner names to answer incidents. It can pause a market, freeze a pool, disable a token and revoke a hook, each at once. It cannot reverse any of them and holds no other power. See Owner powers and upgradeability.
H
Health factor (HF)
The ratio that tells how safely a loan is covered: collateralValue × LT / debtUsd. Above 1 the loan is healthy. When HF < 1 it can be liquidated. See Health factor.
Hook
A contract attached to a Uniswap v4 pool that runs at set points of a swap or a liquidity change. Hooks are written by third parties, and Farmenta reviews a pool's hook before listing the pool. See Collateral.
Hook permission bits
The lowest 14 bits of a hook's address, which encode the callbacks the hook is allowed to run. Farmenta reads them to reject hooks that could interfere with removing liquidity, act before liquidity is added, or charge the caller when liquidity is added, unless the owner has allowlisted the hook after review. See Pool listing.
K
Kink
The utilization level at which the interest curve becomes much steeper: 80% in the Blue-chip market and 70% in the Meme market. Above the kink, borrowing gets expensive quickly, which pushes utilization back down. See Interest rates.
L
Lender funds (totalAssets)
Everything that belongs to the lenders of a market: cash + totalBorrows − reserves. The share price is lender funds divided by the number of shares. See Protocol fees and reserves.
Liquidation
The process in which anyone repays part or all of an unhealthy loan and receives collateral worth that amount plus a bonus. It is what keeps lenders whole when collateral loses value. See Liquidations.
Liquidation threshold (LT)
The share of collateral value that may be covered by debt before a loan becomes liquidatable. The tier maximum is 75% in Blue-chip and 40% in Meme, and a pool's listing can set it lower. See Health factor.
Liquidator bonus
The extra collateral a liquidator receives on top of the amount repaid: at least 5% in Blue-chip and 10% in Meme. It is paid by the borrower, out of the position. See Liquidation mechanics.
Liquidity slice
The part of a position's liquidity that is removed in a partial liquidation and paid to the liquidator as the pool's two tokens. A position NFT cannot be split, so the liquidator receives tokens, not an NFT. See Liquidation mechanics.
Listing
The record the owner writes for each accepted pool. It holds the pool's own risk terms: max LTV, LT, liquidator bonus, removal haircut, debt cap and minimum position value. Positions from a pool without a listing are refused. See Pool listing.
LT ramp
A scheduled, linear decrease of a pool's liquidation threshold from its current value to a lower target. The schedule is stored on-chain, so borrowers can see when their position would become liquidatable. See Owner powers.
LTV and max LTV
LTV (loan to value) is debtUsd / collateralValue. Max LTV is the highest LTV allowed when you borrow: up to 65% in Blue-chip and 30% in Meme. It is always below LT in a pool that accepts new positions, which leaves a buffer before liquidation. See Health factor.
M
Meme market
The market that accepts meme token/USDG positions as collateral: the CASHCAT/USDG, PONS/USDG and AI/USDG pools are listed. It has much stricter parameters (max LTV 30%, LT 40%, small debt caps) and prices the meme token from the pool itself, using the 30 minute TWAP and the spot price. See Markets.
O
Out of range
The state of a position when the pool price is outside its price range. Below the range the position holds only the risk token, and above it only USDG. Being out of range does not trigger a liquidation by itself. See Position valuation.
P
Permit2
A shared approval contract that lets you authorise a token transfer with a signature. Farmenta uses it in mintAndDeposit and increaseLiquidity, so your tokens go straight to Uniswap without passing through the market. See Managing collateral.
PoolManager
The single Uniswap v4 contract that holds every pool and its liquidity. Farmenta reads pool prices and position data from it. See Architecture.
Position NFT
The ERC-721 token issued by Uniswap's PositionManager that represents one liquidity position. It is the collateral on Farmenta, which issues no NFT of its own. See Collateral.
PositionManager
The Uniswap v4 contract that issues position NFTs and carries out liquidity changes for their owners. While a position is collateral, the market is the owner of the NFT. See Architecture.
Principal
The tokens that make up a position's liquidity itself, without its unclaimed fees. Principal is valued at oracle prices, not at the pool's spot price. See Position valuation.
Protocol liquidation fee
A fee the liquidator pays in USDG on top of the amount repaid. It equals one tenth of the pool's liquidator bonus (0.5% of the repaid amount in Blue-chip, 1% in Meme) and goes to the reserve. See Protocol fees and reserves.
R
Removal haircut
A reduction, in the pool's listing, for hooks that keep part of the tokens when liquidity is removed. It lowers the recognised value of every position in the pool and is capped at 2,000 bps (20%). See Owner powers.
Reserve
USDG the market sets aside from interest and from protocol liquidation fees. It is the first buffer against bad debt and is not part of lender funds. See Protocol fees and reserves.
Reserve factor
The share of borrower interest that goes to the reserve: 15% in Blue-chip and 25% in Meme. The rest goes to lenders. See Protocol fees and reserves.
Reserve floor
The part of the reserve the owner cannot withdraw: 1% of lender funds in Blue-chip and 2.5% in Meme. It limits withdrawals only. Bad debt can use the whole reserve, including the part below the floor. See Protocol fees and reserves.
S
Share token
The ERC-20 token a lender receives for supplying USDG: fUSDG-BC in the Blue-chip market and fUSDG-MEME in the Meme market. Its value in USDG rises as interest is earned and falls if bad debt is socialized. See How it works.
Socialization
Spreading a loss over all lenders of a market. Bad debt that the reserve cannot cover is removed from lender funds, so every share of that market loses the same fraction of its value. See Bad debt.
Spot price
The current price in a Uniswap pool. It can be moved by a single large trade, which is why Farmenta values positions at oracle prices and uses spot only as a check or a fallback. See Price oracles.
Stale mode
The state of a Meme pool when no valid TWAP exists: its newest observation is more than 900 seconds old, or its history is shorter than 30 minutes. Liquidations value the meme token at spot price times 0.8. A borrow records a fresh observation itself, so it is refused only while the history is shorter than 30 minutes. See Oracle, market and chain risks.
T
Tier
The risk class of a pool: Blue-chip or Meme. A pool takes the riskier tier of its two tokens, and the tier decides which market accepts it, which presets bound its terms and which price source is used. See Markets.
Timelock
A waiting period between the moment a call is scheduled on-chain and the moment it can run. Farmenta has two. The owner's queue: the owner is a TimelockController, and every owner call waits 2 days in it. The upgrade timelock: an upgrade scheduled in a market can be installed 2 days later, and expires if it is not installed within 14 days after that. An upgrade passes through both, about 4 days in total. See Owner powers and upgradeability.
TWAP
Time-weighted average price. Farmenta's TwapRecorder stores observations of a Meme pool's price and returns the average over the last 30 minutes, which is harder to move than the spot price. See TwapRecorder.
U
Unclaimed fees
Uniswap trading fees a position has earned and not yet collected. They stay the borrower's, count toward collateral value up to 10% of principal, and can be collected while the loan stays healthy. See Managing collateral.
USDG
The US dollar stablecoin that lenders supply and borrowers borrow. Every accepted pool has USDG as one of its two tokens. See Network.
Utilization
The share of a market's funds that is lent out: totalBorrows / (cash + totalBorrows). It drives the borrow rate and tells lenders how much can be withdrawn right away. See Interest rates.