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Executive Summary

Axios Finance is a peer-to-peer lending protocol built on the Fuel Network that enables users to borrow and lend cryptocurrency with fixed interest rates and custom terms. Unlike traditional DeFi lending pools where rates fluctuate based on utilization, Axios matches borrowers directly with lenders, ensuring both parties know their exact returns or costs upfront.

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The Problem: Unpredictable DeFi Lending

Current crypto lending platforms like Aave and Compound operate on a shared pool model:

• Interest rates change constantly based on supply and demand
• A lender earning 5% APY today might earn 2% tomorrow
• Borrowers face the same uncertainty with loan costs
• Planning is impossible when rates are unpredictable

[!IMPORTANT] Variable rates create uncertainty. You can’t plan your finances when your costs or returns change daily.

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The Solution: Fixed-Rate Peer-to-Peer Lending

Axios introduces a fundamentally different approach:

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Core Mechanisms

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Collateralization

All loans are over-collateralized to protect lenders:

• Conservative: 150% (borrow $10k with$15k collateral)
• Moderate: 130% (borrow $10k with$13k collateral)
• Risky: 120% (borrow $10k with$12k collateral)

Higher collateral = safer for lenders = potentially lower interest rates.

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Liquidation

Liquidation protects lenders when loans become unsafe: Trigger Conditions:

1. Missed Repayment: Loan expired without repayment
2. Collateral Value Drop: Below safety threshold (if enabled)

Liquidation Distribution:

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Oracle Integration

Axios uses Stork oracles for real-time price data:

• Continuous price updates
• Multiple data sources aggregated
• Fair liquidation price determination

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Fee Structure

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Protocol Fee: 10% of Interest (5% During Beta)

Example Transaction:

• Borrower requests: 10,000 USDC
• Repayment amount: 11,000 USDC
• Interest generated: 1,000 USDC

Distribution:

• Lender receives: 10,900 USDC
• Protocol fee: 100 USDC (10% of interest)
• Borrower total cost: 11,000 USDC

[!NOTE] Fees are calculated on interest only, never on principal. This is significantly lower than the spread on traditional lending platforms.

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Use Cases

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Scenario 1: The Crypto Holder

Sarah’s Situation:

• Owns 10 ETH worth $35,000
• Needs $20,000 for a business opportunity
• Believes ETH price will rise

Axios Solution:

1. Borrows 20,000 USDC for 90 days
2. Deposits 8 ETH ($28,000) as collateral
3. Agrees to repay 21,000 USDC (5% interest)
4. Uses funds for business
5. Repays and retrieves ETH

Result: Maintained ETH exposure + accessed capital for only $1,000 in interest.

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Scenario 2: The Yield Seeker

Michael’s Situation:

• Has 50,000 USDC sitting idle
• Wants predictable returns
• Uncomfortable with variable rates

Axios Solution:

1. Creates loan offer: 50,000 USDC for 30 days
2. Requires 150% collateral ratio
3. Demands 50,500 USDC repayment (12% APY)
4. Receives repayment after 30 days
5. Earns 450 USDC net profit (after 50 USDC fee)

Result: Earned 10.8% APY net with strong collateral protection.

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Technical Architecture

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Built on Fuel Network

Why Fuel?

• Low transaction costs for accessible lending
• Fast execution for real-time matching
• Modern architecture built for efficiency

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Security Model

Key Security Features:

• Open Source: All contracts publicly auditable
• Automated Enforcement: No human intervention possible
• Isolated Positions: Your loan is independent of others
• Oracle Redundancy: Multiple price sources (planned)

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Risk Disclosure

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For Borrowers

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For Lenders

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Protocol Risks

[!CAUTION] Axios Finance is experimental software. Never invest more than you can afford to lose.

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Roadmap

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✅ Current (Beta Phase)

• Core lending and borrowing
• Fixed-rate peer-to-peer matching
• Automated liquidations
• Stork oracle integration
• Reduced protocol fee (5%)

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🔄 Coming Soon

• Passive Vaults: where users can deposit and forget and that would be used to facilitate loans on chain by vault managers
• Secondary Market: Sell loan positions before maturity
• Multi-Collateral: Combine assets to reduce liquidation risk
• Partial Fills: Multiple lenders for large requests
• Advanced Analytics: Risk scoring and performance tracking

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Getting Started

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Prerequisites

1. Fuel-compatible wallet (Fuel Wallet browser extension)
2. Crypto assets (to borrow against or lend)
3. Basic understanding of collateral and liquidation

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Quick Start Guide

For Borrowers:

1. Connect wallet → Click “Borrow”
2. Select asset, amount, and collateral
3. Choose duration and confirm terms
4. Wait for lender match
5. Receive funds → Repay before deadline

For Lenders:

1. Connect wallet → Click “Lend”
2. Browse requests or create offer
3. Set terms and required collateral
4. Wait for borrower match
5. Receive repayment automatically