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How it works

Meridiant is a set of independent lending markets. In each market, one asset is supplied and borrowed; another asset is posted as collateral. Interest is paid by borrowers and earned by suppliers. If a loan becomes unsafe, anyone can close it.

Nothing here is under-collateralized, and nothing spans more than one market.

The loop​

  1. A market is created with a collateral asset, a loan asset, a price source, and a risk profile (how much you may borrow, when a loan is unsafe, and how interest responds to demand).
  2. Suppliers deposit the loan asset. That liquidity is what borrowers draw from.
  3. Borrowers lock collateral — still in their ownership — and take out a loan smaller than the collateral is worth.
  4. Interest accrues as the book is used. When more of the pool is borrowed, rates rise.
  5. Borrowers repay to reduce or close the loan. Full repayment releases the collateral.
  6. If a position falls below its safety line, anyone may repay it and receive discounted collateral. That is how the pool stays solvent without a trusted closer.

Over-collateralized, always​

A borrower cannot take out more than the market allows against the current value of their collateral. That ceiling is conservative on purpose. Prices move; a buffer is what keeps the pool whole when they do.

The protocol checks a fresh price at the moment a loan is opened or liquidated. It does not act on a stale quote.

What a position looks like​

From a borrower's point of view: collateral locked, debt outstanding, and a health level that compares the two. Health is private to the borrower and the protocol.

From a supplier's point of view: a claim on the pool. As borrowers pay interest, that claim is worth more of the loan asset. Withdrawals are limited to liquidity that is not currently lent out.

What the protocol does not do​

  • It does not take your collateral into a shared vault it owns.
  • It does not mix one market's liquidity with another's.
  • It does not require a privileged actor to liquidate an unsafe loan.
  • It does not publish your size, your health, or your identity to the network.

The next pages walk through markets, supplying, borrowing, liquidation, prices, and rates — still at the product level, not the implementation.