Key Terms

Core terminology used throughout Stormbit documentation.

Core Concepts

Term	Definition
Term	A lending pool with predefined parameters: collateral type, loan asset, LTV, duration limits, and interest rate. Created by Lending Managers.
Loan	An individual borrow position created within a Term. Specifies amount, duration, and collateral deposited.
Premium	The upfront fee paid by borrowers that compensates lenders for volatility and default risk over the loan duration.
LTV	Loan-to-Value ratio. The borrowed amount divided by collateral value at origination. Stormbit checks LTV only at origination, never during the term.
Maturity	The end of a loan's fixed term. Borrower must repay by this date or face liquidation.

Key Innovations

Term	Definition
Oracle-Immune Protection	Stormbit checks LTV only at loan origination, never during the term. Once funded, you cannot be liquidated until maturity—regardless of price movements. ETH drops 30%? Flash crash? You're protected until maturity.
Term Certainty	The assurance that your loan terms cannot change during the loan period. No margin calls, no rate changes, risk transferred to lenders until maturity. Borrowers know their total cost upfront; lenders know their locked period.
Underwriting Surface	The 3D risk pricing model: Risk Premium = f(LTV, Duration, Implied Volatility). Every loan is priced against this surface, which maps the relationship between collateral buffer, time exposure, and market volatility.
Volatility Premium	The additional yield lenders earn for absorbing collateral price risk during the loan term. This is the value that leaks to MEV bots on traditional protocols. On Stormbit, lenders capture it as part of their total yield.

Technical Components

Term	Definition
Delta	The sensitivity of a loan's value to price changes in the collateral. Higher LTV and longer duration = higher delta exposure for lenders.
Hook	Custom logic that can be injected at loan lifecycle events (creation, repayment, liquidation). Enables extensibility without forking. Examples: P2P hook (manual approval), AaveV3 hook (idle yield optimization).
Module	Extensions that enable new collateral types. ERC20LTV module for token collateral, ERC721 module for NFTs, Attestation module for identity-based lending.
Dutch Auction	The liquidation mechanism used at maturity. Price starts at 100% of debt and decreases to 50% over 7 days. First buyer to accept wins, minimizing slippage and preventing MEV extraction.
Epoch	A settlement period for distributing interest to lenders. When loans repay, interest is recorded in epochs. Lenders claim their proportional share when they interact with the protocol.