Glossary

Term	Description
aTokens	Interest-bearing tokens received by users when they supply assets to Tydro. aTokens represent the user’s share of the liquidity pool and accrue interest in real time.
APY	Annual Percentage Yield, which is the yield or interest earned over a year including compounding. This differs from APR, which does not account for compounding.
Borrow Cap	A limit on the maximum amount of a specific asset that can be borrowed from the protocol. Borrow caps help manage exposure and reduce systemic risk.
Collateral	An asset supplied to Tydro to secure a borrowing position. The collateral value must exceed the borrowed amount to ensure solvency.
Cooldown Period	A mandatory waiting period that users must observe before unstaking their tokens from a staking or safety module
Credit Delegation	A feature that allows one user to delegate their borrowing power to another user. The delegate can then take out loans using the delegator’s collateral, facilitated through Tydro’s smart contracts
Debt Ceiling	The maximum amount of debt that can be issued against an isolated asset, used to limit risk exposure to a single collateral type.
E-Mode	Efficiency Mode allows borrowers to access higher borrowing power when using correlated assets (e.g., stablecoins).
Flash Loan	A type of uncollateralised loan offered by Tydro, which must be borrowed and repaid within a single transaction block.
GHO	A decentralised, overcollateralised stablecoin that is fully backed, transparent, and native to the Ink ecosystem.
Health Factor	A ratio that determines the safety of a user’s loan position. It compares the user’s collateral value against borrowed assets. A health factor below 1 triggers liquidation.
Isolation Mode	A mode that restricts borrowing certain assets in isolation to mitigate risk. It limits exposure by restricting debt expansion to a single collateral type.
Liquidation	The process triggered when a borrower’s health factor falls below 1. Collateral is sold to repay part of the debt and restore the position to a safer level.
Liquidation Bonus	An additional incentive paid to liquidators when purchasing undercollateralised assets during liquidation. Expressed as a percentage.
Liquidation Threshold	The collateral-to-debt ratio at which a loan becomes eligible for liquidation. Defined per asset.
Liquidity Index	Tracks cumulative interest earned by a reserve over time, used to calculate interest accrual accurately.
Loan To Value (LTV)	The maximum percentage of a collateral asset’s value that can be borrowed. For example, an LTV of 75% means 1 ETH of collateral allows borrowing up to 0.75 ETH.
Network Risk	Risks associated with the underlying blockchains where Tydro is deployed, such as congestion, security vulnerabilities, or downtime.
Oracle	A decentralised service providing external data (such as asset prices) to Tydro. Oracles are critical for determining collateral values and triggering liquidations.
Ray units	A unit of precision with 27 decimals used internally by Tydro for calculations such as interest and exchange rates.
Reserve Factor	A portion of interest paid by borrowers that is allocated to the protocol treasury to support long-term sustainability.
Risk Admin	An entity or automated process responsible for adjusting risk parameters such as LTVs, borrow caps, or liquidation thresholds. These adjustments ensure the protocol remains secure and aligned with market conditions.
Safety Module	A staking mechanism where tokens are staked as insurance in case of a shortfall event. Stakers may earn rewards but are exposed to slashing risk.
Siloed Borrowing	A restriction that allows certain assets to be borrowed only in isolation. This helps mitigate risks of illiquid or volatile assets.
Supply Cap	A limit on the total amount of a specific asset that can be supplied to the protocol. Helps control exposure to risky assets.
Utilization Rate	The ratio of borrowed assets to total supplied assets in a reserve. Higher utilisation indicates stronger borrowing demand.