Welcome

Covenant is a platform for transforming risk, designed to be a fundamental building block in the structuring of DeFi credit markets.

Users deposit base-assets into specialized vaults, against which leverage-coins and yield-coins are minted. These coins are fungible, tradeable, and composable - creating a capital efficient transformation of the base-asset risk.

Behind the scenes, Covenant introduces two new DeFi primitives: Latent Swap, a DEX invariant for the exchange of credit risk, and Perpetual Debt, a crypto analog of TradFi bonds - where the market price of yield-coins determine the interest they accrue over time.

Using these building blocks, Covenant introduces USDz, a decentralized, over-collateralized and capital-efficient stablecoin, with auto-regulation features balancing yield, risk and capital exposure across collateral assets.

For more details, dive into the content in these docs, or join the community Discord server. The Covenant Liquid section introduces the permissionless platform for transforming risk, and the Covenant Stable section introduces the USDz stablecoin.