Smart Contracts Overview

Introduction

Introduction

The Pools Smart Contracts module underpins Defactor's decentralized lending infrastructure. It consists of multiple contract implementations tailored to support a range of financial and regulatory requirements.

These contracts are responsible for enabling over-collateralized lending, counterparty agreement tracking, interest accrual, and automated liquidation logic—all on-chain and fully auditable.

Two core implementations are currently supported:

• ERC-20 Collateral Pools – for permissionless, token-based collateralized lending
• Counterparty Pools – for structured deals with whitelisted borrower and lender roles

Smart Contract Capabilities

Each contract type supports key features for decentralized loan lifecycle management:

• Collateral Management – lock and release tokens based on borrowing terms and repayment status
• Loan Issuance & Repayment – handle issuance, interest accrual, and repayments programmatically
• Utilization Tracking – monitor pool usage and calculate yield in real time
• Liquidation Logic – automatically enforce repayment deadlines and liquidate overdue positions
• Auditability – full on-chain history of deposits, loans, repayments, and liquidations
• Multi-chain Deployment – available on Ethereum, Polygon, Base, and other EVM-compatible networks

Platform Integration

Pools smart contracts are deployed and managed via the Defactor Pools platform. Through the UI, users can:

• Create new lending pools with configurable terms
• Supply capital or borrow assets via Web3 wallets
• Track positions, pool status, and rewards in real time
• Automatically engage with liquidation events and repayment workflows

These contracts work in coordination with other modules such as Assets for collateral tokenization and Engage for governance and rewards alignment.