In What Situations Are Bids and Offers Filled?

Lending Offer Order Book

Lenders create offers on the lending side of the order book for specific supported maturities. These offers are filled in the following cases:

1. Borrow: someone borrows, and is matched with the lowest rate for their amount and due date
2. Lender Exit: another Lender exits their position, and assigns a new lender from the lending order book in their place

Borrowing Bid Order Book

Users may also wish to place bids to borrow. These may be patient borrowers hoping to lock in a low rate or speculators wishing to borrow low, lend high, and repeat.

Borrow bids are typically filled in the following cases:

1. Borrower Exit: If a borrower wants to exit their loan before the due date, they can assign a replacement borrower from the borrower bid order book in order to not pay full term interest.
2. Borrower Liquidation: If a borrower becomes insufficiently collateralized, they will be liquidated. A keeper may select a replacement borrower if it reduces the cost to liquidate.

Note: lenders may also submit a market order to match with a borrow bid, but this is typically not desirable (they would be lending at sub-market rates). This is currently not yet supported by the UI.