Measure of a bond's price sensitivity to interest rate changes, in years. A 5-year duration bond falls ~5% per 1% rate rise. Short-duration instruments (T-bills, MMFs) have minimal duration risk, explaining their dominance in on-chain RWA adoption.
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Measure of a bond's price sensitivity to interest rate changes, in years. A 5-year duration bond falls ~5% per 1% rate rise. Short-duration instruments (T-bills, MMFs) have minimal duration risk, explaining their dominance in on-chain RWA adoption.
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AMMs, routing, liquidity, lending, and trading infrastructure.
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Bond Duration (bond-duration) Category: DeFi Definition: Measure of a bond's price sensitivity to interest rate changes, in years. A 5-year duration bond falls ~5% per 1% rate rise. Short-duration instruments (T-bills, MMFs) have minimal duration risk, explaining their dominance in on-chain RWA adoption. Related: Fixed Income, Maturity Date, Yield Curve
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Asset class comprising debt instruments paying regular, predetermined interest and returning principal at maturity. Includes government bonds, corporate bonds, T-bills, and money market instruments. Solana's RWA ecosystem is primarily fixed-income-focused.
Date when a debt instrument expires and principal must be repaid. Ranges from overnight (repos) to 30 years (T-bonds). Short-maturity instruments dominate Solana RWA due to lower duration risk. On-chain protocols encode maturity in smart contract logic.
Graph showing interest rates across different maturities for comparable debt. Normal curve slopes upward (longer = higher yield). When inverted (short > long), short-duration tokenized T-bills offer higher yields, explaining their dominance in Solana RWA.
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Debt in a lending protocol where the collateral value has fallen below the outstanding borrow value, making the position impossible to liquidate profitably. Bad debt occurs during extreme market crashes when liquidators cannot act fast enough or when oracle prices become stale. The protocol or its insurance fund must absorb bad debt losses. Kamino's Scam Wick Protection aims to reduce bad debt from price manipulation.
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Asset class comprising debt instruments paying regular, predetermined interest and returning principal at maturity. Includes government bonds, corporate bonds, T-bills, and money market instruments. Solana's RWA ecosystem is primarily fixed-income-focused.
Date when a debt instrument expires and principal must be repaid. Ranges from overnight (repos) to 30 years (T-bonds). Short-maturity instruments dominate Solana RWA due to lower duration risk. On-chain protocols encode maturity in smart contract logic.
Graph showing interest rates across different maturities for comparable debt. Normal curve slopes upward (longer = higher yield). When inverted (short > long), short-duration tokenized T-bills offer higher yields, explaining their dominance in Solana RWA.
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A protocol that enables token swaps using algorithmic pricing against pooled liquidity instead of matching individual buyers and sellers. AMMs use mathematical formulas (typically constant product x*y=k) to determine prices based on the ratio of tokens in a liquidity pool. On Solana, major AMMs include Raydium, Orca, and Meteora.
An AMM design where liquidity providers concentrate their capital within specific price ranges instead of across the full 0-to-infinity range. CLMMs dramatically improve capital efficiency—LPs earn more fees per dollar deposited within their active range. If the price moves outside the range, the position becomes inactive. Orca Whirlpools and Raydium CLMM are leading implementations on Solana.
A smart-contract-held reserve of two or more tokens that enables trading via an AMM. Users deposit token pairs in specified ratios to become liquidity providers and earn trading fees. Pools are identified by their token pair and fee tier. Pool depth (total value locked) determines price impact for trades.
A token issued to liquidity providers representing their proportional share of a pool's reserves and accrued fees. LP tokens can be burned to withdraw the underlying assets. The value of LP tokens changes as the pool's token ratios shift and fees accumulate. LP tokens are often stakeable in yield farming programs for additional rewards.