Glossary

Decentralised lending market — the largest by TVL — with stablecoin supply and borrow markets across 12+ chains.

A stablecoin that maintains its peg through programmatic supply expansions and contractions rather than 1:1 reserves.

A body of law and procedure obliging financial institutions to detect and report suspicious activity.

A smart contract that prices assets via a pricing curve over a pool of reserves rather than an order book.

A simple annualised yield rate that does not account for compounding.

An annualised yield that accounts for compounding — the standard quote for variable-rate lending.

A trade that exploits a price difference between venues for the same asset, ideally with little to no market risk.

An Ethereum optimistic rollup operated by Offchain Labs — the largest L2 by TVL.

A third-party accountant's signed statement that an issuer's reserve balances match disclosed amounts at a point in time.

A security firm's written review of smart-contract code, classifying findings by severity and tracking issuer responses.

A Layer-1 chain with sub-second finality and an EVM-compatible C-Chain.

Coordinated mass redemption that exhausts an issuer's liquid reserves before all holders can be paid.

Coinbase's optimistic rollup built on the OP Stack — fastest-growing L2 by stablecoin yield surface.

Long spot + short perpetual (or futures) to harvest the funding-rate differential, structurally close to delta-neutral.

A virtual-currency business licence issued by the New York Department of Financial Services since 2015.

EVM-compatible chain operated by Binance — large stablecoin float, smaller protocol-level diversity than Ethereum L2s.

The interest rate paid by borrowers in a [[lending-market]], typically a function of pool [[utilisation]].

Payments to vote-escrowed token holders to direct emissions toward a chosen pool — a structural revenue stream in Curve / Balancer ecosystems.

A protocol that lets assets move between chains, usually by lock-and-mint, burn-and-mint, or liquidity-network designs.

A standing reward programme paying ethical hackers for responsibly disclosed vulnerabilities.

An issuer- or chain-operated bridge that produces the version of an asset the issuer treats as its native off-chain representation.

A yield projection that models how the rate degrades as additional capital deploys into the same pool.

A strategy that borrows in a low-yielding currency / asset and lends in a higher-yielding one, capturing the spread.

Circle's burn-and-mint protocol for moving native USDC between supported chains without third-party bridges.

A user-opened debt position backed by crypto collateral — the issuance mechanism for DAI, LUSD, GHO, crvUSD.

Custodial financial services for crypto — exchanges, lenders, brokerages — operated by an identifiable corporate entity.

The risk that an issuer or chain operator freezes, blocks, or refuses to settle a holder's tokens.

A real-world-asset (RWA) tokenisation platform best known for its [[mkr]]-integrated T-bill and credit pools.

A formal-verification firm that produces machine-checked proofs of smart-contract invariants.

The dominant decentralised [[oracle]] network, securing price feeds, randomness, and cross-chain messaging.

The US-headquartered issuer of [[usdc]] and [[eurc]], publicly listed on NYSE since 2025.

The number of tokens that exist on-chain and are not held by the issuer / treasury / unminted.

A US-listed exchange and the operator of [[base]] — co-issuer (with Circle) of cbBTC and a major USDC distribution venue.

Collateral value / debt value — the headline solvency metric for CDPs.

Compound governance token — the first major DeFi liquidity-mining distribution (June 2020).

One of the original DeFi lending markets — pioneered the cToken model and on-chain governance.

The yield realised when interest is reinvested at the same rate it's earned, producing exponential growth.

AMM design where LPs allocate liquidity to a chosen price range, increasing capital efficiency vs. constant-product.

The propagation of stress from one entity / asset to another via balance-sheet, lending, or confidence linkages.

A liquidity-aggregation protocol layered on Curve that converts CRV emissions into a liquid, boosted yield product.

The risk a transaction counterparty fails to meet its obligation — applies broadly to issuers, custodians, and exchanges.

Activity that spans more than one blockchain — bridge transfers, messaging, multi-chain protocols.

The governance + emissions token of Curve Finance, lockable for [[ve-token]] vote-escrowed governance power.

Curve Finance's CDP-issued stablecoin, collateralised by ETH, wstETH, sfrxETH, WBTC, and tBTC, using a soft-liquidation algorithm (LLAMMA).

A stablecoin backed by on-chain crypto collateral, typically over-collateralised, with liquidation rules enforced by the protocol.

A vault or lending-market manager that allocates user deposits across underlying markets — the human / DAO judgement layer above the protocol.

The largest stablecoin-focused AMM, optimised for low-slippage swaps between like-kind assets.

The risk a custodian (bank, exchange, qualified custodian) loses, mismanages, or is denied access to reserves it holds.

The pioneering decentralised stablecoin, issued by MakerDAO via [[cdp]] vaults backed by ETH, RWA, and other collateral.

A blockchain-based collective that holds a treasury and makes decisions via tokenholder voting.

The dominant DeFi data aggregator — TVL, yields, stablecoin supply, and protocol metadata.

A position where price-sensitivity to the underlying asset nets to zero — long spot offset by short derivative.

A stablecoin trading materially away from its target price ($1 for USD-pegged stables) on a primary venue.

Maker / Sky's protocol-set rate paid to DAI / USDS depositors — historically a benchmark for stablecoin yields.

A measure of price sensitivity to interest-rate changes, expressed in years.

A regulated category of monetary value held electronically and redeemable at par — the EU MiCA EMT regime piggy-backs on the existing e-money directive.

A restaking protocol that lets ETH stakers extend their validator set's economic security to other systems (AVSs).

Newly-minted protocol tokens distributed as rewards — most often to LPs and borrowers as a form of customer acquisition.

The issuer of [[usde]] (Synthetic Dollar) and [[susde]] (staked USDe) — a delta-neutral stablecoin built on perp funding.

The dominant smart-contract Layer-1 — host to the largest stablecoin float and the deepest DeFi yield surface.

Circle's EUR-pegged stablecoin, issued under MiCA-aligned EMT framework.

The runtime that executes Ethereum smart-contract bytecode — replicated across all EVM-compatible chains.

How much capital can leave a position at a defined slippage tolerance over a defined window.

A security failure that lets an attacker drain protocol funds — historically the dominant loss vector in DeFi.

The intergovernmental body that sets global AML / CFT standards — its recommendations are adopted into national law.

A USD stablecoin issued by First Digital Trust (Hong Kong), distributed primarily on Binance.

Token price × max supply — the valuation if every token ever to be minted were already in circulation.

A stablecoin backed by off-chain fiat reserves (cash + equivalents) held by a regulated custodian.

A bureau of the US Treasury enforcing AML / BSA obligations on financial institutions including most stablecoin issuers.

A yield rate locked in at deposit time — typically via a tokenised principal claim with a maturity date.

An uncollateralised loan that must be borrowed and repaid in the same transaction — atomic, or it reverts.

Mathematical proof that a smart contract satisfies stated invariants under all reachable program states.

A stablecoin partially backed by collateral and partially by an algorithmic / market-driven mechanism.

A stablecoin issued by Frax Finance — historically fractional, now fully-collateralised in v3.

A periodic payment between long and short perp holders that anchors perpetual price to spot.

Frax Share — the governance + value-accrual token of the Frax Finance ecosystem.

A Curve mechanism that directs CRV emissions to a chosen pool, with weights set by veCRV votes.

A US federal payment-stablecoin framework establishing reserve, disclosure, and supervision rules at the issuer level.

Aave's native CDP-issued stablecoin, minted against assets supplied as collateral on Aave v3.

An exploit that uses voting power (acquired or borrowed) to pass a proposal that drains a protocol.

A token whose holders can vote on protocol parameters, treasury allocation, and code upgrades.

An Aave/Spark-style metric: collateral × liquidation-threshold / debt — liquidation triggers when it drops below 1.

A position taken to offset risk in another position — most often via a derivative.

The opportunity cost an LP incurs when pool composition rebalances toward the underperforming asset.

Yield paid in tokens emitted by a protocol or partner, on top of the underlying native rate.

Property-based testing where a fuzzer hammers contract entry points and asserts user-defined invariants hold throughout.

An international standard for information security management systems (ISMS) — adopted by mature stablecoin issuers and infrastructure vendors.

A lending-market design where each collateral asset has its own market and cannot endanger others.

A Solana lending market and yield-vault aggregator — the largest stablecoin-yield protocol on Solana by TVL.

The customer-identification programme regulated financial institutions run before opening accounts or processing transactions.

A base-layer blockchain that settles its own state and provides its own security — Ethereum, Solana, BNB Chain.

A scaling network that inherits security from an L1 by posting state roots back — rollups, validiums, plasma.

A pool-based protocol where suppliers earn interest from borrowers, with rates set algorithmically by utilisation.

Borrowing against a position to multiply exposure — and amplify both gains and losses.

The largest liquid-staking protocol, issuer of [[steth]] / [[wsteth]] — the dominant ETH-staking yield vehicle.

Forced sale of collateral when a borrower's health factor falls below the protocol's threshold.

A pool of token reserves that a smart contract uses to facilitate swaps, lending, or other on-chain activity.

The risk you cannot exit a position at a fair price within a desired timeframe.

A bridge design where pre-funded LPs fulfil cross-chain transfers — fast, but with LP-side imbalance risk.

The protocol behind [[lusd]] — minimal-governance, ETH-collateralised CDP issuance with a stability-pool liquidation model.

A receipt token representing a share of an AMM liquidity pool — claims a pro-rata fraction of pool reserves.

A receipt token wrapping an LST that has been restaked via EigenLayer to secure additional services.

A receipt token representing a staked PoS asset — accrues staking rewards while remaining transferable.

Liquity's minimally-governed CDP stablecoin, ETH-collateralised, with a 110% min ratio and a stability-pool liquidation mechanism.

The DAO that issues [[dai]] and (since the Endgame rebrand) [[usds]] — the longest-running decentralised stablecoin operator.

For stablecoins, equivalent to circulating supply × $1 — ie. the amount of issuer liability outstanding.

The published, versioned framework StableLens uses to compute risk grades, peg-stability scores, and risk-adjusted APY.

Value an entity ordering transactions in a block can extract from rearranging, inserting, or censoring them.

The EU's comprehensive crypto-asset framework, fully effective Dec 2024 — establishes EMT and ART regimes for stablecoins.

Issuance of new stablecoin units against deposited reserves or collateral — the inverse of [[redemption]].

A US-state-level licence required for businesses moving customer funds — most stablecoin issuers and exchanges hold MTLs in 40+ states.

A regulated mutual fund holding short-duration government / corporate paper, structured to maintain stable NAV.

A modular lending primitive — Morpho Blue isolates each market, with curators (e.g. MetaMorpho) building risk-managed vaults atop.

A US FinCEN registration category required for stablecoin issuers, exchanges, and remittance operators.

A wallet requiring m-of-n signers to authorise a transaction — the dominant operational-control pattern in DeFi.

Yield that comes from underlying protocol revenue (interest, fees) rather than token emissions.

New York State's financial regulator — the most active US state authority over crypto issuers since 2015.

The US Treasury bureau that administers economic sanctions — its lists bind US-touching stablecoin issuers.

An RWA tokenisation platform best known for [[usdy]] and OUSG — tokenised access to US Treasury yield.

The modular L2 framework maintained by OP Labs — underlies Optimism, Base, Mode, Worldchain, Mantle Sepolia, and 30+ others.

A leading smart-contract security firm and the maintainer of OpenZeppelin Contracts — the most-used Solidity library.

An Ethereum optimistic rollup operated by OP Labs — stewards of the OP Stack underlying Base, Mode, and many other L2s.

An L2 that posts state roots to L1 and assumes them valid unless a fraud proof is submitted within a challenge window.

A service that brings off-chain data on-chain — most commonly asset prices used for liquidations and CDP minting.

An exploit class where an attacker moves the price an oracle reports, then triggers favourable liquidations / mints.

Backing debt with collateral worth more than the debt itself — the standard for permissionless CDP stablecoins.

A NYDFS Trust-chartered issuer of [[usdp]], [[pyusd]] (with PayPal), and tokenised-asset infrastructure.

A regulatory category (notably under [[genius-act]] and MiCA EMT) for fiat-backed stablecoins used as payment instruments.

A stablecoin's design target price — usually $1 USD, though EURC, agEUR, and XSGD are pegged to other currencies.

The StableLens compliance dimension that scores how reliably a stablecoin tracks its peg under normal and stress conditions.

A yield-tokenisation protocol that splits yield-bearing tokens into Principal (PT) and Yield (YT) tokens with a fixed maturity.

A futures contract with no expiry, kept anchored to spot via the [[funding-rate]].

An oracle-published time-series of an asset price, queried on-chain by protocols to value collateral or compute liquidations.

A cryptographic or attestation-based demonstration that an issuer's reserves match outstanding liabilities.

A Maker module allowing 1:1 swaps between DAI and other stables (USDC, USDP, GUSD), keeping DAI tightly pegged.

Pendle's tokenised principal claim — purchased at a discount, redeemable 1:1 for the underlying at maturity.

A pull-based oracle network sourced from first-party publishers (exchanges, market makers) — the dominant oracle on Solana.

PayPal's USD stablecoin issued by Paxos under NYDFS oversight, live since 2023 on Ethereum and Solana.

Yield denominated in a major asset (USD, ETH, BTC) sourced from protocol fees rather than token inflation.

A stablecoin whose balance changes algorithmically in each holder's wallet to maintain a target price or yield.

Borrowing against deposited collateral, redepositing the proceeds, and looping to amplify exposure.

Exchanging a stablecoin back to its underlying claim (USD, ETH collateral, USDC at a PSM).

A vulnerability where an external call lets the caller re-enter the original function before state updates settle.

The assets backing a stablecoin's outstanding liabilities — for fiat-backed stables, predominantly cash + Treasuries.

A vulnerability-reporting protocol where researcher and protocol coordinate a fix before public announcement.

Reusing already-staked PoS collateral (e.g., ETH staked via Lido) to secure additional networks or services.

Rocket Pool's non-rebasing liquid-staking token — share-price grows with ETH staking yield.

A letter grade (AAA → D) summarising overall stablecoin or yield-pool risk under the StableLens v0.1 model.

Headline APY discounted by the StableLens risk model — comparable across protocols, chains, and structures.

A decentralised ETH staking protocol — issuer of [[reth]], with a permissionless node-operator set.

An L2 architecture that batches transactions off-chain and posts compressed state + proofs back to L1 for settlement.

Tokenised off-chain assets — Treasuries, money-market funds, credit pools, real estate — used as on-chain collateral or yield products.

Government-imposed restrictions on financial transactions with specified persons, entities, or jurisdictions.

A two-leg MEV exploit — front-run a victim's swap with a buy, let it execute at worse price, back-run with a sell.

MakerDAO's interest-bearing wrapper of DAI, paying the [[dsr]] (DAI Savings Rate).

Reserves held in a way that legally insulates them from issuer-corporate creditors in bankruptcy.

The entity that orders transactions on a rollup — typically centralised today, with decentralisation roadmaps in progress.

Frax's yield-bearing wrapper of FRAX — share-price grows with FRAX protocol revenue, primarily T-bill yield in v3.

Yield that doesn't reinvest interest — equivalent to [[apr]] without compounding.

The post-Endgame rebrand of MakerDAO — issuer of [[usds]] alongside continued [[dai]] support.

Difference between expected and realised execution price — caused by pool depth + competing fills.

A trust-services audit examining controls over security, availability, processing integrity, confidentiality, and privacy.

A high-throughput Layer-1 with sub-second finality — large stablecoin float, distinct ecosystem from EVM chains.

A Maker / Sky-affiliated lending market focused on DAI / USDS markets and high-quality yield-bearing collateral.

A small, dense in-line chart showing recent history of a metric — used throughout StableLens for at-a-glance trends.

A wrapped stablecoin whose share price rises as the underlying earns yield — non-rebasing, easier to integrate.

Lido's rebasing liquid-staking token — accrues ETH staking yield via daily balance rebases.

AAVE staked in the Aave Safety Module — provides backstop capital in case of protocol shortfall, earning emissions in return.

The interest rate suppliers earn in a pool-based lending market — derived from borrow rate × utilisation.

Ethena's yield-bearing wrapper of [[usde]] — share price grows with funding-rate + LST yield, net of fees.

Sky's yield-bearing wrapper of [[usds]] — share-price grows with the Sky Savings Rate (SSR).

A short-duration (≤ 1 year) US government debt instrument — the primary reserve asset for major fiat-backed stables.

The issuer of [[usdt]] — the largest stablecoin by market cap, and the most controversial by regulatory standing.

A delay between when a governance action is queued and when it executes, giving the community time to react or exit.

A leading security firm that audits high-value smart contracts — best known for their depth on cryptographic primitives.

A FATF rule requiring VASPs to share originator + beneficiary information for transfers over a threshold (~$1,000).

A NYDFS authorisation under NY Banking Law allowing the holder to act as a trust company for crypto assets.

The total dollar value of assets deposited in a protocol — the headline scale metric in DeFi.

A price metric averaged over a time window — used by oracles to resist short-burst manipulation.

Usual's permissionless RWA-backed stablecoin, redeemable 1:1 from a portfolio of tokenised T-bills and overnight repo.

The locked, yield-bearing version of [[usd0]] — receives RWA yield in exchange for a 4-year lock.

A USD-pegged stablecoin issued by Circle — the largest fully-regulated, monthly-attested fiat-backed stable.

Ethena's synthetic dollar — collateralised by LSTs / LRTs hedged with short ETH perps.

Paxos's NY Trust-chartered USD stablecoin — strongest US regulatory wrapper of any major stablecoin.

Sky's post-Endgame stablecoin, 1:1 swappable with [[dai]], with sUSDS as the yield-bearing wrapper.

Tether's USD stablecoin — by far the largest by market cap and global trading-pair volume.

Ondo's tokenised, yield-bearing dollar — backed by short-term US Treasuries and bank deposits, available to non-US investors.

Borrowed assets / supplied assets in a lending market — drives the supply / borrow rate via a kinked curve.

A smart contract that automates a yield strategy — users deposit, the contract executes.

A money market on BNB Chain — the largest stablecoin lending market on BSC by TVL.

A token-locking model where governance power and emissions weight scale with lock duration.

A token that represents another asset on a different chain or in a different standard, redeemable 1:1.

A non-rebasing wrapper of Lido stETH — share-price grows with staking yield.

The original DeFi yield aggregator — yVaults route deposits into the highest-risk-adjusted-yield strategies.

A protocol that pools deposits and routes them across underlying yield sources to maximise risk-adjusted return.

Pendle's tokenised pure yield claim — represents the right to all yield accrued by the underlying until maturity.

An L2 that posts validity proofs to L1, enabling near-instant withdrawals and stronger trust assumptions than optimistic rollups.