InfinityPools
  • Welcome
    • Core contributors
    • Trading
    • Providing liquidity
    • Glossary
  • Protocol Overview
    • Introduction
    • TradFi analogy
      • Payoff
      • Maturity profile
      • Loan & option styles
      • Providing liquidity
      • Premium calculation
      • InfinityPools' advantages
      • Why make it decentralized?
    • Mechanism details
      • Swappers
      • Float pool
      • Loan maturity
      • Loan styles
        • Fixed term loan
        • Revolving loan
        • Periodic loan
      • Utilization rate
      • Rate Router
    • New use cases
    • Security
  • Community
    • X (Twitter)
    • Discord
  • LEGAL
    • Terms of Service
Powered by GitBook
On this page
  1. Protocol Overview
  2. TradFi analogy

Loan & option styles

InfinityPools has three instruments that can all be exercised differently:

  1. Fixed term loan - this instrument is similar to a European synthetic option as it cannot be exercised before it matures (that said, same as a European synthetic option, you can still lock in profits at any point).

  2. Revolving loan - this instrument most resembles an American synthetic option but is more powerful as traders can get a refund on "unspent" premium. In other words, if a trader pays a premium for an hour long trade but decides to exercise after 30 minutes, they will get back 50% of their paid premium.

  3. Periodic loan - this instrument is a combination of the previous two, and is the main InfinityPools trade mechanism. Periodic loans start as fixed term loans and switch over to revolving loans after a preset lock in period.

Last updated 7 months ago