On-Chain Orderbook System
Decoding Key Concepts
Last updated
Decoding Key Concepts
Last updated
Secured Finance's Loan Market Platform incorporates an on-chain orderbook system, a pioneering application in the DeFi space. This system facilitates the trading of with a specific maturity date. To ensure clarity, we've defined some key terms used on our platform:
It is an electronic list of buy and sell orders for Zero-Coupon bonds, organized by price level. It enhances transparency by providing visualized information on price, availability, depth of trade, and more.
It refers to an order to borrow crypto assets, equivalent to selling a bond on our platform. After pledging sufficient collateral, you can place a sell order, selling a Zero-Coupon bond and receiving the equivalent cash upfront. You then owe the obligation to repay the money with interest at maturity.
This is an order to lend, equivalent to buying a bond. You buy a Zero-Coupon bond at a discount, which will be redeemable at par at expiration.
A Zero-Coupon bond is a debt security that doesn't pay interest (coupons) but is traded at a deep discount, rendering profit at maturity when the bond is redeemed for its full face value. On our platform, bonds will be redeemable at 100.
Why is On-Chain Orderbook so difficult?
The on-chain Orderbook system is often perceived as inefficient due to high gas costs. As a result, many DeFi projects rely on the liquidity pool system (LP) which is a great financial innovation for gathering liquidity. However, the interest rate provided by the pool lacks composability and transparency. Secured Finance has successfully deployed an on-chain orderbook system using the 'lazy evaluation' method, which significantly reduces gas costs. Learn more details at '' at technical overview.