Glossary

This glossary defines key terms used in GONDI's dApp.

Principal

The amount of WETH or USDC borrowed/lent.

APR (Annual Percentage Rate)

The annualized cost of borrowing, expressed as a percentage.

Gross APR

[Sum of 1 Year Accrued Interest] / [Principal Amount]

Net APR

[Sum of 1 Year Accrued Interest] / [Principal Amount + Interest cost]

Effective APR

• Borrower Effective APR: [ Accrued Interest + Origination Fee / Principal ] * [365/Duration]

• Lender Effective APR: [ Accrued Interest Profit + Origination Fee / Principal + Previous Interest ] * [365/Duration]

Interest

The cost that accrues over time for borrowing, calculated based on APR, principal, and loan outstanding time.

Accrued Interest

The loan interest amount accumulated over time but not yet paid.

Accrued Interest Profit

The interest amount accrued by the lender holding the loan.

Previous Interest

The interest amount accrued by previous lenders that the new lender must transfer to refinance the loan.

Interest Cost

The sum of outstanding interest and accrued interest from previous refinancings.

Origination Fee

An optional one-time fee (WETH or USC), paid by the borrower to the lender at the start of a new loan or renegotiation (regardless of the loan's outcome). The origination fee amount is deducted from the principal amount.

Due Date (or Maturity Date)

The date by which the borrower must repay the loan's principal and accrued interest to avoid default.

Loan Duration

The period during which the borrower has to repay the loan in full, including accrued interest—usually expressed in days.

Loan Default

When a borrower fails to repay the loan plus accrued interest by the due date. In single-tranche loans, the lender can claim the collateral. In multi-tranche loans, the collateral is auctioned, and the proceeds are distributed pro-rata to lenders.

Repayment amount

The total amount to be repaid by the borrower, including principal and accrued interest.

Loan Offer

A proposal extended by a lender to a borrower outlining loan terms, including principal, APR, due date, and optional origination fee.

Loan Collection Offer

A loan offer that can be accepted by a borrower by collateralizing any NFT that belongs to collection the loan offer was created for.

Offer Capacity

The number of borrowers that can accept the same collection offer.

Refinancing

A transaction in which a prospective lender provides lower APR terms to a borrower, becoming the new lender of record.

Partial Refinancing

A transaction in which a prospective lender offers better APRs for a portion of an outstanding loan.

Renegotiation

A transaction where a prospective lender provides different loan terms that are not strictly better than the outstanding loan terms but are preferred by the borrower.