Glossary - Tori Finance

The terms you will meet in the app, in these docs and in the protocols Tori integrates with.

Fundamentals

Term	Meaning	On Tori
APY	Annual percentage yield: the return over a year, including the effect of compounding.	strUSD’s APY compounds through its exchange rate.
APR	Annual percentage rate: the yearly rate without compounding.	Tenor quotes its fixed rates as APR.
Synthetic dollar	A token designed to track $1, backed by trading positions rather than cash in a bank.	trUSD is backed by delta-neutral trading positions.
Delta-neutral	A position hedged so its value does not depend on whether prices rise or fall.	Tori pairs long and short positions to earn from pricing gaps.
Exchange rate	The value of one vault share in its underlying asset. It rises as the vault earns.	One strUSD is redeemable for more trUSD over time.
Gas	The network fee paid to process a transaction.	Paid in ETH on Ethereum and Arbitrum, MON on Monad, PROS on Pharos and SOL on Solana.

Lending and borrowing

Term	Meaning	On Tori
Supply	Depositing an asset into a lending market so others can borrow it, in return for interest.	Supply USDC to Morpho markets that accept strUSD as collateral.
Collateral	Assets deposited to secure a loan. Loans are overcollateralized: collateral exceeds debt.	strUSD keeps earning while it is posted as collateral.
Utilization	Total borrowed divided by total supplied in a market. Rates rise as utilization rises.	Supply APYs on the strUSD markets move with utilization.
LTV	Loan-to-value: your debt divided by the value of your collateral.	Borrowing $700 against $1,000 of strUSD is a 70% LTV.
LLTV	Liquidation loan-to-value: the LTV at which a position can be liquidated.	The Morpho strUSD/USDC market on Ethereum has an 86% LLTV.
Liquidation	When a position reaches its LLTV, a liquidator repays part of the debt and receives collateral plus a bonus.	Debt that grows faster than strUSD, or a fall in strUSD’s value, can trigger it.
Looping	Borrowing against collateral to buy more of it, repeatedly, to increase exposure to its returns.	Spiral Stake loops the Morpho strUSD/USDC market in one transaction.

Liquidity pools

Term	Meaning	On Tori
Liquidity pool	A smart contract holding two or more tokens that traders swap against.	The trUSD/USDC pool on Curve.
LP token	A token representing your share of a pool. Withdrawing burns it for your portion of the assets.	Stake a Curve LP token on Convex or Stake DAO for boosted rewards.
Swap fee	A small fee charged on every trade through a pool. Liquidity providers receive a share of it.	On Curve, fees build up in the value of your LP token.
Gauge	A Curve contract where LP tokens are staked to earn CRV and other token rewards.	Convex and Stake DAO stake your LP tokens in the gauge with a boost.
Auto-compounding	Harvesting rewards and reinvesting them into the position automatically.	Beefy’s frxUSD/trUSD vault reinvests its rewards each time it is harvested.
Impermanent loss	The gap between holding tokens in a pool and holding them outright, caused by price moves between them.	Small in pools of dollar-pegged tokens, unless one moves off its peg.

Pendle

Term	Meaning	On Tori
SY	Standardized yield: Pendle’s wrapper for a yield-bearing token, which it splits into PT and YT.	SY-strUSD wraps strUSD on Pendle.
PT	Principal token: bought at a discount and redeemable 1:1 for its accounting asset at maturity.	PT-strUSD redeems for 1 trUSD worth of strUSD at maturity.
YT	Yield token: receives the underlying’s yield and points until maturity, when its value reaches zero.	YT-strUSD collects strUSD’s rewards and Cores. YT-trUSD collects Cores.
Maturity	The date a PT becomes redeemable 1:1 and a YT stops accruing.	Each Tori market on Pendle has its own maturity date, shown on Pendle and in the app.
Implied APY	The market’s consensus on the underlying’s future APY, implied by the price of YT relative to PT.	Buying PT locks in the implied APY as your fixed rate.

Vaults and tranches

Term	Meaning	On Tori
Vault	A smart contract that pools deposits into one strategy. Depositors receive shares in it.	The Tori Ecosystem Vault on Ethereum takes USDC, USDT or trUSD and issues etrUSD.
Curator	The party that sets a vault’s risk parameters and allocation rules. Deposits stay in the vault’s contracts.	RockawayX curates the Tori Ecosystem Vaults. SharpByte curates a Morpho vault on Monad.
Tranche	A slice of one position with its own risk. The junior tranche absorbs losses first; the senior tranche pays it a premium for that coverage.	Royco offers senior and junior tranches on strUSD.

Next steps

DeFi integrations

Where these terms apply

Risk disclosures

Read these before using leverage or third-party markets