Borrowing

Pyron Borrowing Model

The Fogo DeFi ecosystem offers numerous opportunities to profit, but the landscape is dynamic, making access to instant liquidity essential for capitalizing on many lucrative trades. Pyron allows you to borrow liquidity quickly without needing to liquidate your existing assets, enabling you to take advantage of fleeting opportunities.

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Overcollateralization

Pyron operates as an overcollateralized lending protocol, meaning you must first deposit assets as collateral before borrowing liquidity.

This mechanism ensures:

• loan security

• protection for lenders

• stability for the protocol

The value of supplied collateral must exceed the value of borrowed assets at all times.

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Borrowing Interest

When borrowing on Pyron, there are two components to the borrowing cost:

1- Borrow Interest:

Borrowed funds accrue interest over time.

This interest rate is expressed as an Annual Percentage Rate (APR) and adjusts dynamically depending on utilization and borrowing demand.

The borrow APR can be viewed directly in the Pyron interface and updates continuously as market conditions change. 2- Origination Fee

When opening a borrow position, Pyron may apply a small origination fee.

This fee:

• is charged once when the loan is initiated

• helps incentivize lenders supplying liquidity

• is already reflected in the effective borrow APR/APY shown in the UI

Because this fee is applied at loan initiation, very short-term strategies may feel its impact more than longer positions.

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Dynamic APR

Borrow rates increase as more liquidity is borrowed from a pool.

This mechanism helps:

• balance borrowing demand

• ensure liquidity remains available

• maintain protocol sustainability

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Repayment Flexibility

Pyron does not impose a fixed repayment schedule. You can borrow for any duration as long as your account remains “healthy.” The health of your account is determined by the collateral value relative to the borrowed amount.

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Health Factor

Your Health Factor measures the safety of your borrow position.

It compares:

• the value of your collateral

• the value of borrowed assets

If the Health Factor falls below the liquidation threshold, part of the position may be liquidated to repay lenders and maintain protocol solvency.

To reduce liquidation risk, users are encouraged to maintain a healthy buffer above the liquidation threshold.

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Summary

Pyron’s borrowing model enables flexible access to liquidity while maintaining strong risk controls through overcollateralization, dynamic interest rates, and transparent borrowing costs.

This allows users to deploy capital more efficiently across the Fogo ecosystem while maintaining clear visibility into borrowing parameters and risks.