> For the complete documentation index, see [llms.txt](https://docs.ethosis.org/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.ethosis.org/protocol/syndication.md). # Many lenders, one loan Every Ethosis loan is a small syndicated loan. One borrow request can be filled by any number of lenders, each holding a proportional slice priced at their own APR. This is the core of the product rather than a feature bolted on. ## What syndication buys * **Small lenders can back large loans.** A 200,000 USDG borrow against tokenised NVDA can be assembled from twenty lenders putting in 10,000 each. * **Borrowers do not depend on a single large balance sheet.** Depth comes from how many offers sit in the book, not from any one whale. * **No lender shares anyone else's risk.** There is no pool and no common bad-debt account. A lender who priced a slice at 8.5% holds that slice and nothing more. ## Slices and slice tokens When a loan is originated, the contract issues one ERC-721 slice token to each lender. The token records: * the loan ID and market, * the slice's principal, * the slice's fixed APR, * the start timestamp, * the lender's chosen flags (`selfLiquidate`, `noClosedMarketLiquidation`). Each slice accrues interest on its own, at its own APR. Repayments, rollover payouts and auction proceeds are all shared out by slice principal. Slice tokens can be transferred, but only to an address that clears the access registry. That restriction is what allows a secondary market in loan positions to exist without weakening compliance. ## Sharing the numbers Take a loan with slices (s\_1 \dots s\_n), principals (P\_1 \dots P\_n), and total principal (P): * A partial repayment (R) cuts slice (i)'s principal by (R \times P\_i / P). * Auction proceeds (X), after the keeper's part of the penalty is removed, pay slice (i) an amount of (X \times P\_i / P), capped at that slice's outstanding principal plus accrued interest. Whatever is left over is surplus for the borrower. * Interest accrued so far on slice (i) is `P_i × apr_i × elapsed / 365 days`. Since slices carry different APRs, the rate the borrower actually pays is the principal-weighted average of them. ## No partial originations Origination is atomic and the offers in the transaction must cover the request exactly. If the book cannot cover the whole request, nothing happens; the borrower either trims the principal or waits for more offers to arrive. Attaching additional slices to a loan that already exists is on the roadmap. ## Senior and junior slices (roadmap) The next protocol release brings tranching inside a syndicate, following the Centrifuge DROP/TIN pattern. A lender may choose the **junior** slice, which takes the first loss if an auction falls short and earns a higher rate for doing so, while **senior** slices are paid ahead of it. Tranching is elected per offer, and lenders who never elect it are unaffected. The waterfall receives its own audit before it is switched on. ## Twenty lenders in one transaction A borrower wants 200,000 USDG against 2,500 NVDA tokens, worth roughly 441,000 USDG, for an LTV of 45.4%. The relayer gathers twenty standing offers of 10,000 USDG apiece with APRs between 8.2% and 9.0%. A single `originate` call then: * locks the 2,500 NVDA in escrow, * draws 10,000 USDG from each of the twenty lenders (from the Morpho vault for those who opted in), * delivers 199,500 USDG to the borrower once the origination fee is taken, * issues twenty slice tokens. Suppose the borrower repays after 30 days at a blended 8.6%. Interest comes to roughly 1,414 USDG, divided among the twenty slices according to each one's principal and its own APR. The protocol keeps 10% of that interest as its share. --- # Agent Instructions This documentation is published with GitBook. GitBook is the documentation platform designed so that both humans and AI agents can read, navigate, and reason over technical content effectively. Learn more at gitbook.com. ## Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter, and the optional `goal` query parameter: ``` GET https://docs.ethosis.org/protocol/syndication.md?ask=&goal= ``` `ask` is the immediate question: it should be specific, self-contained, and written in natural language. `goal` is optional and describes the broader end goal you are ultimately trying to accomplish on behalf of the user. GitBook uses it to tailor the answer towards what is most useful for that goal. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.