> ## Documentation Index
> Fetch the complete documentation index at: https://lending.satsterminal.com/llms.txt
> Use this file to discover all available pages before exploring further.

# How it works

> The protocol, end to end, on one page.

# Three actions. No surprises.

The protocol exposes exactly three operations. Everything else (front-ends, integrations, vaults) sits outside the core and cannot break what's inside it.

<CardGroup cols={3}>
  <Card title="Lend" icon="hand-holding-dollar">
    Deposit into a specific market. Earn borrower interest in real time. Withdraw on demand, subject to utilization.
  </Card>

  <Card title="Borrow" icon="vault">
    Post collateral into a market. Draw the loan asset against it, up to the market's LTV. Repay any amount, any time.
  </Card>

  <Card title="Liquidate" icon="gavel">
    Anyone can close an unhealthy position. Bad debt clears in real time. No whitelist. No auction.
  </Card>
</CardGroup>

***

## Why isolated markets matter

Every market on SatsTerminal Lending is **its own ring-fenced contract** with its own collateral asset, oracle, and risk parameters. If a market fails (bad oracle, thin liquidation path, anything), **only that market's lenders are exposed.** Every other market in the protocol is untouched.

Contrast the original DeFi lending design, where every listed asset shares one giant risk surface. A single bad listing can drain the entire protocol. That class of failure does not exist here, by construction.

<Note>
  Risk isolation isn't a feature added on top. It's the topology of the protocol.
</Note>

***

## Lenders set the listing standard

There is no listing committee, no governance vote, no team picking winners. Markets are defined by their parameters; **lenders vote with their deposits.** Capital flows to markets they trust, and away from markets they don't.

That is how a credit market is supposed to work, pricing risk continuously, transparently, and without intermediaries.

<Card title="See the full architecture →" icon="arrow-right" href="/architecture">
  Flashnet settlement, oracle design, liquidation mechanics, and what the core actually contains.
</Card>