Arenas Protocol

The Arenas Protocol is the credit engine behind every financing market. It defines the on-chain building blocks — markets, pools, obligations and roles — and the standard lifecycle a financing goes through, from request to repayment. As a depositor you work with a pool; the protocol enforces the rules underneath it, including the ones that govern when your capital can be lent.

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What it is

Arenas is a configurable, credit-based financing engine. Instead of the overcollateralized, auto-liquidating model of typical money markets, it implements approval-gated, undercollateralized credit: liquidity providers fund pools, borrowers request financing, a permissioned approver signs off, and repayment is governed by an off-chain legal agreement rather than a collateral ratio.

Each market is configured for a specific real-world program (for example Brazil – Coffee – USDC). All markets share the same engine, so they behave consistently and stay within the same protocol-level limits.

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The liquidity side (depositors)

As a depositor you interact with the pool adapter, not the borrower flow:

• Deposit — approve the asset token and deposit into the pool to receive pool shares that accrue interest as borrowers repay. See Deposit.

• Withdraw — withdrawals are a two-step, delayed process: createWithdrawRequest, then executeWithdrawRequest after the pool’s withdrawDelay. If liquidity is locked in active obligations, a request may be fulfilled proportionally. See Withdraw.

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Core building blocks

Component	What it is
FinancingMarket	The market contract. Holds the borrower request/approval/draw-down/repayment logic and routes funds to and from pools.
FinancingMarketAdapter (pool)	The liquidity pool (pool-v2). Depositors (LPs) deposit the asset token and receive pool shares; the adapter supplies capital to the market when a financing is drawn down.
Access-token NFT	A borrower’s eligibility credential in a market. Owning the access token is what lets an address create requests and draw down — there is no ERC-20 collateral to post.
Obligations	On-chain accounting of what a borrower owes: principal, interest, and other obligations, tracked per financing.

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The financing lifecycle

Your capital is lent through a fixed sequence of on-chain steps. Each step maps to a role and a market-contract call:

1. Request — the borrower calls requestFinancing (interest accrues over time) or requestFixedFinancing (a fixed repayment amount). Requests can be revised (modifyRequest) or withdrawn (closeRequest). No token approval is needed — eligibility is the access-token NFT.

2. Review — an Approver reviews the pending request and either approveRequest (optionally for a partial amount) or declineRequest. Approval does not move any funds.

3. Draw down — the borrower calls receiveFinancing to disburse an approved request. Liquidity is sourced from one or more pools by passing lender intents (packed address+id tranches) sorted by rate ascending, so the cheapest capital fills first. The recipient address can differ from the borrower’s wallet. Fills can be partial if pool capacity is short.

4. Repay — anyone (not only the borrower) can repay at any time: repay for a full payoff, or the fine-grained payInterest / repayPrincipal / payOtherObligations. Loans are effectively open-ended; repayment is enforced by the signed agreement, not by an on-chain health factor.

There is no collateral-based liquidation. Instead, a non-performing obligation is recovered through the off-chain agreement, with the recovered amount paid back directly to the affected pool’s depositors.

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Roles

• Depositor (LP) — supplies capital to pools and earns interest and incentives.

• Market Operator — configures the market within protocol limits and (absent a separate approver) reviews requests; earns a share of interest as a market fee.

• Approver — the permissioned role that approves or declines financing requests.

• Borrower — holds the access token, creates requests, draws down, and repays.

• Curator — arranges liquidity and pool relationships for a market.

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What the protocol guarantees

Whatever a specific market configures, the protocol ensures that:

• All markets follow the same request → approve → draw down → repay lifecycle.

• Fees and permissions stay within predefined protocol limits.

• Liquidity, disbursement and repayment use the same standardized engine and accounting.

• Only allowlisted addresses can deploy new markets on a product.

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Supported networks

Arenas markets are deployed on Somnia:

Network	Chain ID	Type
Somnia	5031	Mainnet