Otomato Glossary — DeFi & On-chain Terms Explained

The ratio of weighted collateral value to borrowed value on lending protocols. When it falls below 1, your position can be liquidated.

When a lending protocol sells part of your collateral to repay your debt because your position crossed its liquidation threshold.

When an asset designed to track a reference price (stablecoin, LST, wrapped asset) trades meaningfully away from that peg.

The variable interest rate paid to suppliers on lending protocols. It scales with utilization of the underlying market.

The variable interest rate paid by borrowers on lending protocols. It scales steeply with utilization and can flip leveraged positions into losses.

On perp DEXes, a periodic payment between longs and shorts that anchors the perpetual price to the underlying spot price.

The difference between the expected price of a trade and the price at which it actually executes.

The opportunity cost of providing liquidity to an AMM pool versus simply holding the two assets in your wallet.

Pendle Principal Token. Represents the principal of a yield-bearing asset, redeemable 1:1 at maturity. Trades at a discount that converges to par.

Pendle Yield Token. Represents the future yield of a yield-bearing asset over a fixed period. Decays to zero at maturity.