Lend

Product Overview

Lending is one of the simplest ideas in crypto: you supply an asset, others borrow it, and interest bridges the two. Most protocols stop there. Flying Tulip’s FT Lend takes the familiar model and places it inside an adaptive market that “understands” depth, volatility, and where prices can actually clear. That context matters for everything: how much you can safely borrow, how expensive it is to do so, and how positions are unwound when they need to be. The result is a lending layer that feels like the experience you know, yet behaves like it’s plugged into a living market; because it is.

Two forms of FT Lend coexist. A permissionless layer spins up a lending market for any trading pair that exists on the AMM. If there is an ETH/USDC pool, there is an ETH↔USDC lending pair automatically. Beside it sits a permissioned pool with pre‑configured parameters for assets the protocol is willing to cross‑margin broadly. That pool is the collateral backbone for the rest of the system: the CLOB (central limit order book), Perps, settlement, and liquidation logic all speak to it. A single deposit there can back a loan, rest as collateral for a limit order, and support a perp position, simultaneously, without moving the funds around.

What “lending” means in practice

On the surface, FT Lend works the way you expect. Suppliers deposit assets and begin accruing interest; borrowers post collateral and take loans within loan‑to‑value limits. Under the hood, the limits and the rates are market‑aware. Instead of hard‑coded tables, the system asks: How much of token X could we sell for token Y right now without blowing through depth? and How variable is that answer over the last hour, the last day, the last week? That information comes from the AMM’s price and reserve windows (time‑weighted TWAP and reserve‑weighted RWAP, among others). When the market is calm and deep, your borrowing power is more generous. As volatility rises or depth thins, your available LTV gracefully tightens.

“Snapshot LTV” makes those promises predictable. When you open (or adjust) a position, the system evaluates the market and snapshots your LTV limits then and there. If policy shifts later, your existing position isn’t retroactively punished; you’ll see new limits the next time you make a change. Your collateral is still marked‑to‑market, if the asset you posted drops, your health moves with it, but the rulebook doesn’t change under your feet.

Interest rates follow the same philosophy. Utilization still matters, busy pools raise rates to attract supply and ration demand, but the schedule can lean higher in more volatile regimes and relax when conditions are benign. Rates are posted up front, visible on the pool page, and update continuously.

Permissionless markets: lending where there is liquidity

The permissionless side takes the AMM as its map. If the AMM exposes a pair, FT Lend exposes a lending market on the same pair. You can borrow ETH against USDC, or USDC against ETH, without asking governance to whitelist anything. The system reads depth from the AMM and computes size‑aware borrowing power: a small loan that would barely nudge price is treated differently from a large one that would have to walk through reserves.

Because each market is anchored to a real pool, liquidations are soft by default. When a position needs to be trimmed, the engine simulates impact against the AMM’s adaptive curve, then sells into depth in slices rather than dumping in one clip. It prefers the AMM path that minimizes slippage, and if resting orders exist on the CLOB at a better price, it crosses those first. For suppliers, that means fewer fire‑sale events. For borrowers, it means a gentler path back to safety.

Permissioned pool: cross‑collateral and zero‑liquidation strategies

The permissioned pool covers a curated set of assets that the protocol is willing to cross‑margin against one another. Here, collateral is fungible across products: a single deposit can earn money‑market yield, back a CLOB limit order you placed earlier in the day, and collateralize a perp position you open this afternoon. While your order waits to fill, your deposit stays productive; there is no "dead" capital tied up on the sidelines.

A debt‑netting mechanism lives in this pool and makes certain delta‑neutral constructions behave very differently from typical loans. If your long and short legs are sized to offset, your borrow can be netted by the yield in the structure and, within configured bounds, eliminate conventional liquidation paths. That’s how ftUSD is able to operate with near‑zero liquidation risk in practice: the borrow and the earn legs are designed to cancel directional exposure, and the pool enforces the balance.

Liquidations that respect the market

Liquidations are not a punishment; they are a risk tool. FT Lend treats them accordingly. Before any sale, the engine “asks” the AMM curve what the next clip would do to price. If the impact would breach guardrails, the system takes a smaller step, waits a beat, and checks again. Large positions are time‑sliced by design. Keepers who execute with low impact are rewarded; slash‑and‑grab behavior gets nothing. Because the same market informs lending and pricing, the engine can also choose to net exposures internally when that reduces footprint, or route a portion through resting CLOB liquidity when it improves outcomes.

This is not just kinder during stress; it’s also fairer in ordinary moments. When markets are healthy, you get fast, single‑clip resolution. When they are fragile, you get a staircase instead of a cliff.

Pricing and LTV: how the AMM informs the numbers

Everything starts with prices you can actually trade at. The AMM publishes TWAP and RWAP windows across multiple horizons. TWAP gives you a clean time average; RWAP weights by reserves near the execution path and is therefore closer to realizable. LTVs are computed against those windows with buffers that reflect volatility and utilization. If depth is abundant and dispersion low, a borrower can responsibly draw more. If reserves thin or spreads widen, the window tightens. You see those numbers the moment you create or adjust a position; they are the basis of your snapshot.

Because the AMM curve itself adapts, leaning toward constant‑sum when calm and constant‑product when volatile, these windows reflect that reality. It is harder to push price in a quiet regime; it is easier to push it when the pool is already stressed. The lending engine reads the same signals and sets limits accordingly.

Fees, interest, and where they go

Borrowers pay interest; suppliers earn it. FT Lend routes these cashflows through the protocol’s token‑first model. Lenders receive their share as FT‑denominated distributions (the system converts the stream into FT so the percentage you earn stays what the market dictated, while also creating direct demand for the token). A protocol fee may be taken where policy allows; that portion flows into the FT buyback pipeline that also governs unlocks for Foundation, Team, Ecosystem, and Incentives. No rates are promised, and all yields are variable. The point is that the value created by borrowing activity is visible and programmatic, paid to lenders and reflected in the token economics, not vanishing into operational burn.

Using FT Lend day‑to‑day

If you want to supply, you choose an asset, deposit, and watch your balance climb as interest accrues. If you want to borrow, you post collateral and draw the asset you need. On the permissionless side you borrow against the pair the AMM exposes. On the permissioned side, you borrow against your whole approved portfolio and keep trading while your deposit continues to earn. Your dashboard shows health, snapshot LTV, current rates, and how much room you have left.

If you do nothing after opening, the rules you opened under remain in force for that position, even if the policy changes tomorrow. If the market moves against your collateral, the engine trims exposure softly. If the market is calm, you barely notice; if it's turbulent, you see slices instead of shocks.

How‑to overview

Supplying. Open Lend, pick the asset, review the current supplier APY and policy fee, and deposit. Your position appears immediately and begins accruing. You can withdraw at any time subject to pool liquidity.

Borrowing (permissionless). Pick the AMM pair market (e.g., ETH/USDC), post one side as collateral, and borrow the other. The interface displays your snapshot LTV, liquidation buffers, and the rate you’ll pay.

Borrowing (permissioned / cross‑margin). Deposit any approved collateral, and borrow any other approved asset. Your single deposit backs loans, CLOB orders, and perps simultaneously. Health and limits reflect the whole portfolio.

Repaying & adjusting. Repay interest and principal to free up collateral, or add collateral to increase headroom. Adjusting your position will re‑snapshot LTV under current conditions.

FAQs

What is “snapshot LTV,” and why does it matter?
It’s the practice of locking your borrowing limits at the moment you open or adjust a position. Policy changes won’t retroactively tighten your existing headroom; you’ll see new limits only when you modify the position.

How does FT Lend choose liquidation size?
By simulating impact on the AMM’s adaptive curve and using time‑sliced execution when needed. It also sweeps resting CLOB orders when they offer better prices, and rewards keepers who minimize footprint.

Can I use one deposit to trade and borrow at the same time?
Yes, in the permissioned pool. One deposit can back a loan, rest as collateral for CLOB orders, and support a perp position, all while earning the underlying money‑market yield.

How are lenders paid? In what token?
Lenders receive the same market‑determined APY they would expect, delivered as FT via the token‑first pipeline. A policy fee may be taken to fund protocol operations and buybacks.

Are there assets I can borrow in the permissionless markets that I can’t borrow cross‑margin?
Permissionless markets exist wherever the AMM has a pair. The permissioned pool supports a curated list of assets suitable for broad cross‑margining and portfolio‑level risk.

Is any of this guaranteed?
No. Rates and limits are variable. Collateral is marked‑to‑market. Liquidations are possible. See the risk page for details on smart‑contract, market, and venue risks.

Related pages

• FT AMM: Product Overview: how prices and depth are computed, and how they adapt by regime
• Perps: Product Overview: how funding and risk reference AMM/CLOB windows
• ftUSD: Product Overview: delta‑neutral stable that relies on Lend's debt‑netting
• FT Token: Product Overview: token‑first revenue flows and buyback pipeline
• Risks, Security & Audits: general DeFi risks and capital‑allocation specifics
• How‑to Guides: Supply, Borrow, Cross‑Margin (coming soon)