About Twyne
Twyne is a credit delegation layer that routes credit within lending markets to users who need it most.
Borrowers seeking higher leverage can pull borrowing capacity from other lenders.
Lenders activate idle capacity and earn delegation fees on top of their base lending rates.
Both users remain fully within the underlying lending market; their positions are temporarily combined to optimize outcomes for both.
Today's lending markets like Euler and Aave suffer from two core inefficiencies:
Over half the lenders aren’t using their borrowing capacity, lowering utilization rates for everyone and missing out on extra yield for themselves.
Borrowers are forced to opt in to conservative Liquidation Loan-to-Value (LLTV) ratios, which artificially limits their max leverage exposure and causes premature liquidations.
Instead of tackling them in a vacuum, Twyne makes these 2 problems solve each other.
In creating a marketplace for borrowing power, Twyne lets lenders (called Credit-LPs) earn additional APY by delegating their credit. On the other hand, borrowers on Twyne can utilize this extra credit capacity in several different ways: more defensively to create a larger safety buffer against liquidations, or more offensively to leverage up much higher than the underlying market allows.
These docs will cover how Twyne works and explore its core use cases, liquidation mechanism, interest rate design and more.
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