Glossary

A comprehensive reference of terms used throughout the Dualis Finance documentation and protocol. Terms are listed alphabetically.

A

APY (Annual Percentage Yield)

The annualized rate of return on a supplied or borrowed asset, accounting for the effect of compounding. Dualis computes APY from the base APR using continuous compounding over the interest accrual period. Supply APY reflects what suppliers earn; borrow APY reflects what borrowers pay. See Interest Rate Model.

B

Borrower

A verified participant who takes a loan from a Dualis lending pool by posting collateral and paying interest at the algorithmically determined borrow rate. Borrowers may access over-collateralized or under-collateralized loans depending on their credit tier.

C

Canton Network

A privacy-enabled, interoperable blockchain developed by Digital Asset. Canton provides sub-transaction privacy, deterministic finality, and DAML smart contracts. Dualis Finance is deployed on the Canton Network to leverage these properties for institutional lending. See Why Canton.

Collateral

Assets deposited by a borrower to secure a loan. In Dualis, collateral can be crypto assets, tokenized real-world assets (RWAs), or tokenized institutional fixed-income assets (TIFAs). Each collateral type has a specific haircut and LTV ratio defined by the collateral framework.

Credit Oracle

An external data provider that supplies off-chain institutional credit data to the Dualis protocol. Credit oracles feed into the hybrid credit scoring engine, combining traditional credit assessments with on-chain borrowing history. See Credit Oracle API.

Credit Tier

One of five creditworthiness classifications assigned to borrowers: Diamond (850-1000), Gold (700-849), Silver (500-699), Bronze (300-499), or Unrated (0-299). Each tier determines interest rate discounts, maximum LTV ratios, and eligibility for under-collateralized lending. See Credit Tiers.

D

DAML

Digital Asset Modeling Language. A purpose-built smart contract language used on the Canton Network. DAML enforces authorization rules, privacy boundaries, and atomic multi-party transactions. Dualis uses 38 DAML templates across 25 modules to define all on-chain protocol operations. See DAML Smart Contracts.

Delegation

The act of assigning one's DUAL token voting power to another address without transferring token ownership. Delegated voting power can be used in governance proposals and is revocable at any time. See Voting & Delegation.

DUAL Token

The native governance token of the Dualis Finance protocol. DUAL holders can create proposals, vote on protocol parameter changes, delegate voting power, and stake tokens to earn protocol revenue. See DUAL Token.

F

Flash Loan

An uncollateralized loan that must be borrowed and repaid within a single atomic transaction. Flash loans enable arbitrage, liquidation, and collateral swaps without requiring upfront capital. Dualis charges a 0.09% fee on flash loan principal. See Flash Loans.

G

Governance

The system by which DUAL token holders collectively manage protocol parameters, risk settings, and treasury allocations. Governance operates through on-chain proposals with voting periods, quorum requirements, and timelock delays. See Proposal System.

H

Health Factor

A numerical measure of a borrowing position's solvency, calculated as the ratio of risk-adjusted collateral value to total outstanding debt. A health factor below 1.0 triggers liquidation eligibility. See Core Concepts: Health Factor.

I

Institutional Pool

A lending pool configured with access controls requiring KYC/KYB verification and optionally restricted to specific credential types or jurisdictions. Institutional pools enable compliant lending between verified counterparties while maintaining the algorithmic rate-setting and automated liquidation of DeFi.

K

KYB (Know Your Business)

The identity verification process for institutional entities. KYB verifies corporate registration, beneficial ownership, regulatory status, and authorized signatories before granting access to institutional lending pools and higher credit tiers.

KYC (Know Your Customer)

The identity verification process for individual participants. KYC ensures compliance with anti-money laundering (AML) regulations and is required for access to regulated lending pools. See KYC/AML Compliance.

L

Liquidation

The process by which a borrower's collateral is seized and sold to repay their debt when their health factor falls below 1.0. Liquidators receive a bonus (typically 5-10% of the liquidated collateral) as an incentive. See Liquidation Engine.

LTV (Loan-to-Value)

The ratio of a loan's value to the value of the collateral securing it, expressed as a percentage. A 75% LTV means a borrower can borrow up to $75 for every $100 of collateral posted. Maximum LTV varies by collateral asset type and borrower credit tier.

N

Netting

The process of offsetting mutual obligations between counterparties to reduce the total number and value of settlements required. In securities lending, netting reduces collateral movement and settlement risk. See Netting & Settlement.

O

Oracle

An external data feed that provides real-time asset prices to the protocol. Dualis aggregates data from 11 oracle feeds to determine collateral valuations, compute health factors, and trigger liquidations. Oracle prices are validated for staleness and deviation before use.

P

PartyLayer

The wallet SDK used to connect Canton Network participants to the Dualis protocol. PartyLayer manages key generation, transaction signing, and party identity on the Canton ledger. It provides a wallet-agnostic interface for DeFi operations including supply, borrow, repay, and collateral management. See PartyLayer (Wallet SDK).

Pool

A lending market for a specific asset where suppliers deposit funds to earn interest and borrowers draw loans against posted collateral. Each pool has independent risk parameters including reserve factor, interest rate model, and collateral requirements.

Privacy Level

The degree of data visibility configured for a lending pool or transaction. Canton's sub-transaction privacy ensures each party sees only the data relevant to their role. Privacy levels range from fully private institutional pools to semi-public pools with anonymized aggregate statistics.

Proposal

A formal governance action submitted by a DUAL token holder for community vote. Proposals can modify protocol parameters, adjust risk settings, allocate treasury funds, or upgrade smart contracts. Each proposal passes through creation, voting, timelock, and execution phases. See Proposal System.

Q

Quorum

The minimum percentage of total voting power that must participate in a governance vote for the result to be valid. Quorum requirements prevent low-turnout votes from making significant protocol changes. The quorum threshold is itself a governance-configurable parameter.

R

Reserve Factor

The percentage of interest income retained by the protocol as reserves. Reserves serve as a first-loss buffer against bad debt and fund protocol operations. Each pool has an independently configurable reserve factor. See Core Concepts: Reserve Factor.

S

Securities Lending

The practice of temporarily transferring securities from a lender to a borrower in exchange for collateral and a fee. Dualis provides an on-chain securities lending marketplace with atomic settlement and automated fee collection. See Securities Lending Overview.

Staking

The act of locking DUAL tokens in the protocol to earn a share of protocol revenue and gain enhanced governance voting weight. Staked tokens are subject to a cooldown period before withdrawal.

Sub-transaction Privacy

A privacy model unique to the Canton Network where different parts of a single transaction are visible only to the parties who are directly involved in those parts. This allows complex multi-party transactions to execute atomically while preserving confidentiality between participants. See Privacy Architecture.

Supplier

A participant who deposits assets into a Dualis lending pool to earn interest. Suppliers provide the liquidity that borrowers draw from and receive a proportional share of the interest income generated by the pool, minus the reserve factor.

T

Timelock

A mandatory delay between when a governance proposal passes and when it can be executed. The timelock provides a window for participants to review approved changes, exit positions if they disagree, or flag concerns before execution. See Timelock & Execution.

TIFA Finance

Tokenized Institutional Fixed-income Assets. A category of structured financial products that are tokenized and can be used as collateral within the Dualis protocol. TIFA assets carry a 20% haircut to account for their illiquidity and complex payoff structures.

U

Utilization Rate

The percentage of a pool's total available liquidity that is currently being borrowed. Utilization rate is the primary input to the interest rate model: as utilization increases, borrow and supply rates rise to incentivize repayments and attract new deposits. See Core Concepts: Utilization Rate.

V

Veto

A governance mechanism that allows designated guardians or a supermajority of token holders to block a passed proposal during the timelock period. Veto power serves as a safety mechanism against malicious or erroneous governance actions.

Voting Power

The weight assigned to a participant's vote in governance decisions, determined by the number of DUAL tokens held or delegated. Staked tokens may receive a multiplier on voting power to reward long-term protocol alignment. See Voting & Delegation.

Z

ZK Credentials

Zero-knowledge credential proofs that allow participants to demonstrate compliance attributes (e.g., accredited investor status, jurisdictional eligibility) without revealing the underlying personal data. ZK credentials enable privacy-preserving access control for institutional pools while satisfying regulatory requirements.