Financing Request Lifecycle
A financing is not a single transaction — it moves through a state machine, and each transition is performed by a different role. The step most people miss is that approval and draw-down are separate: an approver authorises an amount, and the borrower later draws it down themselves.
The states
REQUESTED
Request created, awaiting review. Can still be edited or cancelled.
Approver (or borrower)
APPROVED
An amount is authorised and a timed receive window is open. No funds have moved.
Borrower
ACTIVE
Financing drawn down; obligations accrue until repaid.
Borrower (repay)
CLOSED
Request cancelled or declined before draw-down.
—
Step 1 — Request
The borrower creates a request against a market, choosing:
Amount and minimum amount — the acceptable fill band
[minAmount, amount].Type — interest-accrual (with a rate ceiling) or fixed-repayment (a fixed repay amount over a duration).
Recipient — where funds should land (defaults to the access-token owner).
No token approval is needed; eligibility is the access token (NFT). While in REQUESTED, the borrower may modifyRequest or closeRequest.
Step 2 — Review (approve ≠ fund)
An Approver reviews the request and either:
Approves it — optionally for a partial amount within the requested band — which opens a receive window (an earliest and latest time to draw down), or
Declines it.
Approval moves no money. It authorises an amount and starts a clock. This is the key difference from collateral-based lending, where borrowing is instantaneous.
The receive window is snapshotted at approval and does not change even if the market is reconfigured later.
Step 3 — Draw down (receive)
Inside the receive window, the borrower draws the money down. Liquidity is sourced from the pool’s lender intents, selected automatically cheapest-rate-first — the borrower does not hand-pick lenders in the standard flow. See Intents & Liquidity.
A draw-down can partially fill if pool capacity is short, and the borrower can draw again (up to the approved amount) while the window is open. Because on-chain capacity can change between approval and draw-down, a fill is only final once the transaction settles. Possible outcomes:
Success
Financing becomes ACTIVE.
Lack of capacity
Not enough lender liquidity available right now.
Rate exceeded
The only available liquidity is priced above the request’s ceiling.
Below minimum
The achievable fill is under the request’s minAmount.
Step 4 — Repay
Once ACTIVE, anyone (not only the borrower) can repay — in full or in part — at any time. Repayment is enforced by the off-chain agreement, not by an on-chain health factor, so there is no price-based liquidation. See Repay.
If a loan is not repaid, the obligation can be sold on a secondary market at a discount, with proceeds refunded to the affected pool’s LPs.
Last updated