I saw someone in the group asking about Boros collateral, which should also be a point of confusion for some Boros users: @Since boros_fi is a capital rate market, why can't we use USDT as collateral to open positions like common contracts? Based on Grandma @ pendle_grandma's response, I would like to add a few points of my understanding—— one ️⃣ Capital rate market ≠ ordinary lending market The logic of traditional DeFi lending protocols is that the fund pool is uniformly mortgaged, and as long as the assets are safe and have low volatility, they can basically be mortgaged. But Boros' design philosophy is different, it requires that the collateral assets in each market must be consistent with the valuation assets traded. The reason is simple: Prevent cross asset liquidation risks. For example—— You have opened a long order of 10 BTC (worth 1.1 million u) on the exchange, and in order to hedge against funding fees, you only need to short 10 YU-BTC on Boros. ⚙️ At this point, the hedging relationship is "BTC to BTC", with the same valuation unit. The changes in profits/losses on Boros directly correspond to the fluctuations in exchange fees, and the risk model is simple. If USDT is used as collateral, the problem becomes much more complicated—— The same 10 BTC multiple order requires a corresponding position of 1.1 million YU-USDT to offset the capital fee, which will bring three problems: 1) Hedging calculations are more complex and require constant conversion of BTC prices. 2) The volatility of collateral and funding fees are not in the same dimension, making it difficult to develop a risk model. 3) The user experience becomes more chaotic, and clearing and risk control become less intuitive. If the BTC price drops sharply, the value of USDT will not change, but the collateral ratio will instantly become imbalanced, and the system will either be forced to liquidate or require complex re collateralization logic. So from the perspective of risk efficiency, the vast majority of users playing the cryptocurrency based market on Boros will have a higher cost-effectiveness. Boros' native asset collateral market can provide higher leverage because risk control models are more predictable. two ️⃣ Why only Hyperliquid's funding rate supports USDT collateral? Some people may not have noticed that on October 3rd, Boros launched a USDT market specifically for Hyperliquid, and the team should have made a lot of considerations: If you look at the funding curve of Hyperliquid, you will find that it is almost the most volatile in the entire market. It can flip several times in a day, and the frequency of traders' position updates is also extremely high. This frequent fluctuation in interest rates is precisely the raw material that the capital rate market needs the most—— The more intense the volatility, the larger the trading space, the higher the trading density, and the stronger the hedging demand, the more valuable the trading value, which is in line with Boros' appetite. Boros chose to first land USDT collateral on Hyperliquid, which I feel is a small-scale test Test the sensitivity, depth, and participation of the capital rate market using the fastest reacting market. This runs smoothly, it may only be a matter of time before we take on more markets in the future. After analyzing the above, I feel that the @ pendle_fi team has done a very meticulous job in the operation of Boros, taking into account security, matching, and user experience. This is the level of detail that a mature protocol should have, and it deserves a thumbs up! In addition, yesterday Boros launched a new term fund fee market (due on November 28, 2025), providing a longer hedging window. You can take a closer look at whether there is a pricing difference between long and short-term contracts, as there may be opportunities for cross term arbitrage. The Boros series of teaching materials previously written can be referenced by interested friends! https://((((x.com))))/Bitwux/status/1961620194620854732 https://((((x.com))))/Bitwux/status/1964521312657018928 https://((((x.com))))/Bitwux/status/1956237907574055261 https://((((x.com))))/Bitwux/status/1954004619627225302 In Pendle's newly opened Boros communication channel, many hidden experts have been discovered, providing many strategic ideas. Suggest adding it, you can really learn something! https://t.me/PendleFinance_CN