FAQ

What is Stormbit? A lending protocol where every loan is insured with put options. Borrowers get no-liquidation loans. Lenders earn yield from the spread on hedging activity.

How is it different from other lending protocols? Traditional DeFi lending liquidates your position when collateral drops below a threshold. Stormbit insures it instead. Loan terms are fixed duration — no mid-term liquidation. Yield comes from the spread on hedging activity and varies with borrowing volume and market conditions.

Can I really not be liquidated? Correct. Once funded, your collateral cannot be liquidated until the maturity date — regardless of price. Your position is insured.

Why are rates higher than other protocols? Stormbit's rate includes the cost of hedging your loan — that's the price of no-liquidation protection. The quoted rate is the ceiling. When you repay, unused hedge value is returned as a rebate, lowering your effective rate. Cheaper rates elsewhere come with liquidation risk.

How do lenders earn? Supply to specific lending markets and earn premiums from that market's loans. Idle funds also earn base yield. See Earn for details.

Are lender deposits safe? Deposits are protected by collateral + insurance down to the protection level. As collateral price drops, insurance picks up the difference. See Risks for edge cases.

What happens if I don't repay? Collateral is forfeited and sold via Dutch auction in Deals. Set a calendar reminder.

What is the protection level? The price floor where insurance covers the loan. Protection Level = Loan Amount / Collateral Units. Example: $80K loan, 2 BTC → $40,000/BTC.

Can I withdraw anytime? Unallocated funds: yes. Funds in active loans: locked until maturity. Use Exit Full Position to stop new allocations and wind down.

What collateral is supported? V0: WBTC (65-75% LTV, 7-14 day terms) and WETH (60-65% LTV, 7-14 day terms). More assets planned.