Annual interest rate paid by a bond issuer as percentage of face value. A 5% coupon on $1,000 bond pays $50/year. In tokenized bonds, coupon payments are automated as on-chain distributions. T-bills are zero-coupon (purchased at discount, redeemed at par).
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Annual interest rate paid by a bond issuer as percentage of face value. A 5% coupon on $1,000 bond pays $50/year. In tokenized bonds, coupon payments are automated as on-chain distributions. T-bills are zero-coupon (purchased at discount, redeemed at par).
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AMMs, routing, liquidity, lending, and trading infrastructure.
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Coupon Rate (coupon-rate) Category: DeFi Definition: Annual interest rate paid by a bond issuer as percentage of face value. A 5% coupon on $1,000 bond pays $50/year. In tokenized bonds, coupon payments are automated as on-chain distributions. T-bills are zero-coupon (purchased at discount, redeemed at par). Related: Fixed Income, T-Bill (US Treasury Bill), Basis Points
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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.
Short-term US government debt (4-52 week maturity) sold at discount, redeemed at par. Considered safest short-term investment. Most popular RWA category on-chain — Ondo's USDY and BlackRock's BUIDL hold T-bills.
Unit of measurement equal to 0.01% (one hundredth of a percentage point). 100 bps = 1%. Used across DeFi for swap fees, protocol fees, and yield spreads. Token-2022's transfer fee extension configures fees in basis points.
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Assessment of creditworthiness by agencies (Moody's, S&P, Fitch). Ranges from AAA (near risk-free) to junk (BB+ and below). US Treasuries are AAA-rated. Private credit DeFi protocols must evaluate risk without formal ratings, a key risk factor.
A periodic payment exchanged between holders of long and short perpetual contract positions to keep the perp price anchored to the spot price. When the perp trades above spot (positive funding), longs pay shorts; when below spot (negative funding), shorts pay longs. Funding is typically settled every hour on Solana perps platforms like Drift and Jupiter Perps. High funding rates create arbitrage opportunities.
The algorithm a lending protocol uses to determine borrow and supply interest rates based on pool utilization. Most Solana lending protocols use a kinked (piecewise linear) model with a gentle slope below optimal utilization and a steep slope above it, creating urgency to repay when liquidity becomes scarce. Parameters include base rate, optimal utilization point, and slope values for each segment.
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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.
Short-term US government debt (4-52 week maturity) sold at discount, redeemed at par. Considered safest short-term investment. Most popular RWA category on-chain — Ondo's USDY and BlackRock's BUIDL hold T-bills.
Unit of measurement equal to 0.01% (one hundredth of a percentage point). 100 bps = 1%. Used across DeFi for swap fees, protocol fees, and yield spreads. Token-2022's transfer fee extension configures fees in basis points.
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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.