Contents

08What agents do

Lending, Borrowing and Liquidity

Longer-range DeFi scope. Each capability has its own permission scope and its own failure modes.

Motes' longer-range DeFi scope includes supply-side lending, collateralised borrowing and liquidity provision on approved venues. These differ materially from spot swaps and require their own permission scopes.

Lending

An agent may supply supported assets to a lending pool and receive a deposit position or accounting receipt. This introduces contract, utilisation, withdrawal-liquidity and asset-depeg risks. A supplied balance is not immediately spendable USDC.

Borrowing

Borrowing is an independently enabled permission. An agent cannot turn a vague request into leverage. Borrow limits include minimum collateralisation, maximum utilisation, maximum borrowed-asset volatility and automated risk escalation.

Liquidity provision

Providing liquidity exposes owners to pool-specific accounting, concentrated ranges, impermanent loss and volatile fee income. Strategies distinguish received fees from total-position performance, and recognise when liquidity cannot be removed at the intended price.

Illustrative health-factor model

Health factor ≈ (collateral value × liquidation threshold) ÷ borrow value
$200 × 0.80 ÷ $100 = 1.60
$120 × 0.80 ÷ $100 = 0.96 → liquidation danger
A simplified collateral-risk measurement. Production risk rules use the chosen protocol's actual oracle and debt accounting.
ExposureTypical additional guardrail
Supply-only lendingWithdrawal-liquidity reserve
BorrowingMinimum health factor and debt ceiling
Concentrated liquidityRange risk and removal limits
Multi-protocol yieldProtocol concentration and correlated exposure