Factor is a decentralized credit infrastructure that transforms real-world receivables and specialized debt into instantly liquid, yield-generating opportunities on-chain. Built on Avalanche and powered by Chainlink’s proof-of-reserves and proof-of-performance oracles, Factor bridges the capital efficiency gap between traditional finance and crypto by enabling frictionless access to short-duration, high-yield real-world credit.

In the traditional economy, receivables markets exceed tens of trillions of dollars but remain slow, opaque, and siloed. Liquidity takes weeks or months to flow, underwriting is manual, and investors are excluded from participating directly. Factor introduces a programmable, transparent, and risk-aligned credit layer by tokenizing these assets as $F-NFTs—verifiable receivable tokens with on-chain metadata, auditability, and proof of collateral.

Unlike existing RWA protocols that rely on multi-layered tranching and borrower exposure, Factor operates on an underwriter-first-loss model. Curated factoring fintechs onboard receivables, declare their expected default rate, and stake matching first-loss capital. This stake protects investors up to the declared risk while aligning incentives toward conservative underwriting and high-quality receivable selection. Upon maturity, capital flows through a transparent, immutable waterfall where investor principal is repaid first, underwriter stake is redeemed second, and all remaining profit is split 50/50 between underwriters and liquidity providers.

This design enables investors to earn 8–21% APY from real-world yields generated by receivables typically yielding 16–42% annualized, all while maintaining underwriter accountability and on-chain validation of performance. Receivable documents are encrypted and stored on IPFS, with repayments and maturity events validated using Chainlink oracles to guarantee trust-minimized execution.

$FACTOR, the protocol’s utility and governance token, powers fee reduction, underwriter bonding, and the decentralized approval process for new underwriters and receivable classes in future protocol iterations. As Factor evolves from a curated underwriter network to a fully decentralized receivable marketplace, it unlocks global liquidity for real-world credit while maintaining strict transparency, risk alignment, and institutional-grade compliance.

Factor represents the next generation of on-chain credit—transparent, scalable, and open to anyone