Adding a market

Each on chain lending book can have its own market. A market opens on a book only when it clears six thresholds. Until a book qualifies, it sits in the pipeline.

What a book has to clear

• Real economic loss. The book carries a borrower default, real collateral falling below the debt, or a liquidation that gaps and recovers less than the loan. A hack or exploit of the protocol's own contracts does not settle. A book made whole by automatic liquidation has nothing to settle on.
• Loan level data on chain. Each loan, its size, its rate, its payment status, and any write down is read directly from the chain.
• Size floor. At least 50 million in outstanding loans.
• Borrower diversification. At least 10 distinct borrowers, each above the 10 million per name floor.
• Observable losses. Defaults and write downs show up on chain.
• A readable coupon. The loans pay a rate read on chain, so the loss feed and the reference number can be computed against the risk free rate.

When a book clears all six, a market opens on it as its own series with its own two tokens, a long side and a short side, and its own price set on the curve. The threshold is mechanical, with no committee vote. Ravariant reads the loss, publishes the reference number, determines losses, and settles. It sets no price. A book that later falls below the floors is wound down at the next roll.