Frequently Asked Questions
General
What is on this site?
Documentation for the lending products built by the Zap team. Three protocols at different stages: Pawn (peer-to-peer NFT lending, live), Forge (pool-based money market, in design), and Loaded NFT Pool (pool lending against staked .qom domains, planned).
Who runs this?
The Zap team. Smart contracts live on QOM L1 and are non-custodial — once deployed, no team action can move user funds outside the rules in the code.
Where can I use the products?
- Pawn: defi.zaphod.one/pawn — already live.
- Forge: launch route will be
/lendonce deployed. - Loaded NFT Pool: route TBD; will be announced at launch.
The flagship Zap-team app for QNS staking is at staking.zaphod.one.
What chain is this on?
QOM L1 — an EVM-compatible Cosmos SDK chain (chain id 766), built on the Evmos stack (CometBFT consensus, Cosmos SDK modules for staking/governance/IBC, and Evmos's EVM module for Solidity execution). Native asset is QOM; WQOM is the wrapped ERC-20 representation used by every smart contract that needs to handle QOM as a token. WQOM ↔ QOM is 1:1 with no slippage.
Is the source code public?
Smart-contract source and the deployed bytecode hash will be published on this site at launch for Forge and the Loaded NFT Pool. Pawn's contract source is published in the Zap repo; on-chain verification on the block explorer is scheduled alongside the external audit.
Forge (pool lending, ZAP collateral)
Why two loan types in one pool?
Direct Loans and Bootstrap Loans share the same QOM lender pool but serve different borrowers. Direct Loans are the standard money-market product (deposit ZAP, borrow QOM). Bootstrap Loans turn a QOM borrow into a self-deleveraging staking position via QNS Staking — a primitive only QOM has, because no other chain has QNS Staking's deterministic emission schedule plus registry-level lien hooks.
Lenders see a single APY across all utilization. They don't need to think about which loan type their QOM is funding.
What's special about the oracle?
The TWAP oracle reads the ZAP/QOM market on QomX. The LP for that market is burned — its liquidity-provider tokens were sent to a dead address. The pool is permanent: it cannot be removed, and the liquidity cannot be withdrawn. This eliminates the most common oracle-rug risk in DeFi (LP-removal attacks, signer-committee compromise, off-chain feed downtime).
How does the Bootstrap Loan actually work?
In one transaction:
- The pool borrows QOM to itself.
- The QNS controller mints a fresh
.qomfor the user. - The contract stakes that
.qominto QNS Staking with a lien naming the lending pool. - ZAP emissions from QNS Staking route back to the pool, are sold to QOM at the TWAP, and retire the user's debt.
The user does not put up collateral. The collateral is the staking position itself, and its emission stream is the repayment stream. When the debt clears, the lien lifts; the user calls unstake() on QNS Staking to take possession of the .qom.
See Bootstrap Loan for the full flow.
What if I just want to borrow QOM against ZAP, no Bootstrap?
That's a Direct Loan. Deposit ZAP, borrow up to 40% LTV in QOM, pay variable interest, repay any time. See Direct Loan.
Can I get liquidated by a single bad block?
No. The protocol has a 24-hour grace period between health-factor crossing 1 and liquidation actually being triggered. Single-block oracle noise will not take a solvent position. See Liquidations.
What's the worst case for a depositor (lender)?
By design, lenders are not exposed to bad debt. Any shortfall from a position that cannot be liquidated cleanly is absorbed by the protocol reserve, not by lenders. The reserve is funded by the 25% reserve factor on borrow interest plus the protocol's share of the liquidation bonus. See Resilience.
The only fundamental loss vector for lenders is a smart-contract exploit that drains the pool. This is mitigated by external audit, a UUPS proxy that allows fast pause, and a bug bounty program at launch — but is never zero.
How are interest rates set?
A two-slope kinked curve, utilization-driven:
- Below 80% utilization: rates rise gently from a 4% base to ~12%.
- Above 80%: rates rise steeply (slope reaches ~57% at 95% utilization).
The steep tail keeps a withdrawal buffer for lenders without a hard cap on borrowing. See the Rate Card for the full table.
Pawn (P2P NFT lending)
How is Pawn different from the Loaded NFT Pool?
Pawn is bilateral — every loan is between one specific borrower and one specific lender. There is no pool, no shared risk, and no oracle. The lender judges the NFT's resale value at funding time. Pawn handles the long tail of NFTs that cannot be reliably priced on chain.
The Loaded NFT Pool is pool-based — many lenders share risk, and the protocol prices the collateral by reading the staking emission schedule directly from QNS Staking. It only handles staked, reward-bearing .qom domains, because those are the only NFTs whose future cash flow is deterministic and on-chain.
Why no oracle on Pawn?
NFTs don't have reliable price feeds, especially long-tail collections. A pool-based design with a noisy oracle gets liquidated wrong, often. Peer-to-peer lets each lender make their own price call, which is the only honest answer for assets that lack a market clearing.
What if my NFT collection is small / nobody bids on my listing?
Listings without funding just sit. You can re-list with better terms (higher APR, lower principal, shorter duration) until a lender takes it.
Can I refinance?
Not in v1. Each loan is fixed-term, no rollover. You can repay the existing loan and immediately list a new one with different terms; they are separate transactions.
Can I negotiate the terms?
Yes. Borrowers list with an asking principal/APR/duration; lenders can either lend at those terms or send a counter-offer with different numbers. Borrower clicks accept on whichever offer they want. All offer + counter-offer signing is off-chain (gas-free) — only the final accept costs gas. A lender offer can also be collection-wide, accepted by any owner of any token in that collection.
Where can I see live protocol activity?
defi.zaphod.one/pawn/stats — total volume, active loan count, default rate, top collections, and lifetime interest paid. Per-wallet aggregates appear at /pawn/my once you connect.
Loaded NFT Pool (pool lending against staked .qom)
What's "loaded"?
A .qom domain that is actively staked in QNS Staking, with ZAP rewards accruing or already locked on the position. The Loaded NFT Pool's collateral is specifically these staked NFTs — not unstaked .qom, not random NFTs.
How does it value the collateral without an oracle?
It reads the staking position directly from QNS Staking: locked ZAP, future emission rate × remaining time × position weight. Both quantities are state on the staking contract, not external prices. The TWAP from the (LP-burned) ZAP/QOM market converts that ZAP value into a QOM borrow limit. No floor-price oracle, no off-chain valuation.
When does it launch?
After Forge is live and stable. See the overview.
Tech / security
What audits have been done?
- Pawn: internal test suite (full-flow integration tests covering offer-accept, repay, liquidate, edge cases, and admin actions) passes prior to mainnet. External audit + on-chain source verification scheduled before scaling beyond public beta.
- Forge: scheduled for an external audit before mainnet. Source code will be verified on the QOM block explorer at deployment under Business Source License 1.1 — the same license used by Aave v4, Morpho, Euler v2, Fluid, Silo, Maple, and Ajna. BUSL-1.1 keeps the source fully readable for users and auditors while restricting commercial copy-fork-deploy by competitors during the license window; converts to an open license afterward. Audit report, verified-source links, and the deployed bytecode hash will be published on this site at launch.
- Loaded NFT Pool: audit will be scheduled when design is locked. Same verification + license commitment as Forge.
What if there's a bug post-launch?
Each contract uses the UUPS proxy pattern. The team can pause new originations within a single block (existing positions remain repayable) while a fix is staged. Storage layout is gap-reserved to make safe upgrades possible. Emergency upgrades are logged on chain via Upgraded events.
Why upgradeable contracts?
Trade-off accepted explicitly. A non-upgradeable contract is more credibly trust-minimized but cannot recover from bugs found after launch — the alternative is leaving a known-bad contract holding user funds. The upgrade key is held by the team at launch and migrates toward a multi-sig or governance contract over time.
Money
Are there fees?
Yes. Forge publishes its rate card in detail — see the Rate Card. Pawn charges two: a small origination fee deducted from the principal at funding, and a small interest-fee slice taken at repayment from the lender's interest. Both are admin-tunable but bytecode-capped (origination ≤ 2%, interest fee ≤ 10%) — admin cannot exceed those caps without a public on-chain upgrade.
Where do fees go?
To the protocol treasury. Reserve covers bad-debt absorption (Forge), and the surplus funds protocol operations, audits, and ZAP-related buyback flows once the model is proven.
Can I view the protocol's reserve balance?
Yes — once Forge is live, the contract address and reserve balances will be linkable on the block explorer. Pawn does not have a pooled reserve (no shared risk).
Still have questions?
The deepest details are in the linked product pages: