Risks

For lenders#

Defaults are shared#

If collateral sells for less than a loan's debt, the difference is written off and every note in that auction redeems for less. Collateral rules make this unlikely but do not rule it out.

Untaken loans earn nothing#

A borrower who wins but doesn't take the loan leaves the reserved USDC in the pool. It comes back to notes without interest, which lowers that auction's return.

Your USDC is committed for the term#

There is no early withdrawal. Notes are transferable, but Tenor runs no market for them; leaving early means finding a buyer.

For borrowers#

Liquidation at 200%#

Below 200% anyone can close your loan and buy the collateral at a 5% discount. A fast drop can move the ratio from safe to liquidated between two blocks. Keep a margin above the line, and add collateral from Portfolio when the gauge moves toward it.

Interest is owed in full#

Repaying early owes the same four weeks of interest as repaying at maturity.

One day to take the loan#

The program rechecks collateral at 250% when you take the loan. If prices fell after you committed, the loan can fail that check and expire, leaving you without USDC.

No rollover#

A maturing loan does not roll forward. Plan the next auction before your maturity.

For everyone#

Bonds on unrevealed orders#

An order that is not revealed in time loses its 1 USDC bond. Keep the reveal file.

Revealed orders are public#

After the reveal, an order's rate and size stay on chain whether or not it fills.

Thin auctions set noisy rates#

The rate is wherever offers and bids cross. In a small auction one large order can set it. During commits the desk shows every sealed order's side and maximum size, so you can see how deep the book is before you reveal.

Oracles and liquidity#

Borrowing and liquidation need fresh Pyth prices. During an outage, new loans and liquidations wait; repayments and refunds continue. Liquidation also needs buyers with USDC; the keeper doesn't step in.

jitoSOL and USDC#

jitoSOL is valued at the stake pool rate less 10%, not at a market price. A market discount deeper than 10% is not captured until it shows up in a liquidation. Debt is valued at USDC's price plus its confidence interval, so a USDC depeg makes loans look less healthy, not more.

Program risk#

Tenor is a Solana program. Its custody and arithmetic can only be as sound as its code, and every interaction carries the risk of a defect.

How the ratios were chosen#

The 250% and 200% ratios come from one year of daily SOL/USD prices, 1 October 2025 to 30 September 2026, across 337 overlapping 28-day windows. The worst close-to-close fall within a window was 45.99%, and the worst intraday low was 54.00% below the window's start. Covering that low with 15.75% interest and a 5% discount, with no liquidation along the way, would have taken 231.61% of collateral.