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PM Lending Pool

The lending pool is the cash behind PM financing. Lenders deposit USDC. Portfolio margin accounts borrow it, automatically, to pay option premiums and expiry settlements while their collateral sits on Hyperliquid. Lenders earn the interest borrowers pay.

The Lend page is not in the app yet. The pool's live state, your position and withdrawal requests are under /v1/pm-pool in the REST reference.

Shares​

  • Depositing mints shares. You deposit USDC on HyperEVM and receive pool shares at the current share price. The first deposit into an empty pool prices shares at 1 USDC.
  • Share price is NAV per share. NAV is the pool's cash, plus the carrying value of its loans, minus expected losses on impaired loans that the first-loss reserve does not cover. The reserve's cut of unpaid interest is not counted as lender value.
  • Rounding favors the pool. Minting rounds shares down and a partial payout burns shares rounded up.
  • Interest raises the share price. As borrowers accrue interest, loan value grows, NAV grows, and every share is worth more. There is no separate payout; you earn through the share price.
  • Shares can go to another wallet. You can mint to a different LP wallet. Only that wallet can withdraw them.
  • Pricing can pause. If the inputs the pool needs to value its loans are stale, pricing pauses. A deposit made while paused waits and mints automatically once pricing resumes.

What lenders earn​

The pool's borrow APR follows the utilization curve on the PM financing page: 4% APR at 60% utilization, rising to 100% at full utilization. Lenders earn what borrowers pay, minus the reserve factor, the share of interest that funds the first-loss reserve. The reserve factor is currently 15%. Your effective return depends on how much of the pool is lent out: idle cash earns nothing.

GET /v1/pm-pool returns the live supply APR, borrow APR and utilization, and GET /v1/pm-pool/history returns their history.

Withdrawing​

Withdrawals are paid in epochs, not on demand. The pool runs hourly epochs with one epoch of notice.

  1. Queue a withdrawal for some or all of your redeemable shares. You sign it with the wallet that owns the shares; delegated API keys cannot withdraw.
  2. Wait out the notice epoch. A request queued during an epoch becomes payable at the end of the next one, at that epoch's share price. With hourly epochs that is one to two hours after you queue.
  3. Get paid as liquidity allows. The queue is paid first in, first out. If borrowers hold most of the cash, a payout can be partial; the rest stays queued, in order, and is paid as cash comes back. Shares waiting in the queue keep earning interest and keep bearing losses until they are paid.
  4. Cancel any time before it is paid.

The minimum is 1 share, or your whole balance. The epoch length and notice are pool settings and can change; GET /v1/pm-pool returns eligible_at_ms_if_requested_now, when a withdrawal queued now becomes payable.

First-loss reserve​

The first-loss reserve is a separate pot of USDC that absorbs losses on bad loans before lenders do.

  • Funded by interest. The reserve factor share (15%) of all interest borrowers pay goes to the reserve.
  • Funded by Hypercall. Hypercall can top it up with direct deposits.
  • Reported by GET /v1/pm-pool as reserve_cash_usdc, with the current reserve_factor.

The reserve is finite. It does not refill itself after a loss beyond the interest that flows into it.

A loan is written off only after collection from the borrower's HyperCore collateral has run out. The write-off then applies, in order:

  1. Unpaid settlement counterparties. The reserve pays the accounts the borrower still owes expiry settlement to, oldest batch first, and takes over their claims. What the reserve cannot pay stays a claim on the borrower.
  2. The loan. What is left of the reserve covers the loan's carrying value.
  3. Lenders. The rest leaves NAV, so the share price drops. The loss is split across positions by shares held plus shares queued for withdrawal.

Risks​

  • Credit risk. A borrower can fail to repay. Hypercall first collects from the borrower's HyperCore collateral (see recovery). If a loan is written off, the loss hits the first-loss reserve first, then lenders through a lower share price. Queued withdrawals share that loss. Anything recovered later is paid back to lenders pro rata, reported as recovered_usdc by GET /v1/pm-pool.
  • Liquidity risk. You cannot always get out on the next epoch. In a busy expiry, most of the pool can be lent out, and withdrawals are paid only as borrowers repay. One payout stuck in review holds every later epoch until it clears.
  • Rate risk. Your return moves with utilization. A quiet market means low utilization and low yield.
  • Smart contract and operational risk. Deposits sit in the Hypercall Exchange contract on HyperEVM, and loans are run by the Hypercall engine. Bugs or outages in either can delay withdrawals or cause losses.

Lending is not a deposit account. Only lend what you can leave in the pool through a stressed expiry.

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