At the centerpiece of our model is pools. Each pool is governed by an underwriter that decides which loans get approved, at which APYs and which loans don't.

In having multiple pools, we can create a competitive marketplace with both the best rates and LTVs. In addition, thanks to Fuse's upcoming fund forwarding feature, un-utilized capital from the losing pool's side can be directed to the winning pool – providing additional capital efficiency despite the multiple pool model.

In order to begin receiving a loan, one or both of these conditions need to be satisfied:

• A spigot needs to be installed to a revenue generating contract
• Collateral needs to be available and escrowed into a custodial account for the Junior tranche, and directly into the Rari Fuse Pool for the Senior tranche.

What does Due Diligence look like?

See this doc here.

How does depositing work?

The Senior tranche is where the most risk averse capital enters: stablecoin issuers, institutions, and others deposit into it to lock in a solid fixed rate.

The Junior tranche is where more of the risk capital enters: yield aggregators, DAO treasuries looking for a return, whales, and others.

Depositors will receive fTokens as a deposit receipt token for depositing into each subpool (representing each tranche). Tranche

What triggers a default?

A failure to make payment on principal will trigger a default. A grace period can be pre-specified, however after this ends, the default process begins.