Glossary
Definitions of key terms used throughout the Domination Finance documentation.
Collateral
USDC deposited by a trader to back a leveraged position. This is the capital at risk.
Dominance
An asset's share of total cryptocurrency market capitalization, measured against the top 200 assets by market cap. Expressed as a percentage.
$dfUSDC
The ERC-4626 vault share token. Represents a proportional claim on the vault's USDC holdings. Price fluctuates based on trader PnL and fee accrual.
Epoch
A fixed 3-day period used by the vault for PnL settlement and withdrawal scheduling. Unrealized PnL is committed to share price at epoch boundaries.
Funding Rate
A continuous per-block payment between longs and shorts. The side with more open interest pays the side with less. Incentivizes balanced OI and anchors perpetual prices to the oracle index.
Isolated Margin
Each position has its own dedicated collateral. Losses on one position do not affect others. DomFi uses isolated margin exclusively.
Leverage
The multiplier applied to collateral to determine position size. 50x leverage on $100 collateral = $5,000 position. Higher leverage amplifies both gains and losses.
Liquidation
Forced closure of a position when its value drops to or below the liquidation margin. The trader receives nothing — all remaining collateral goes to the vault.
Liquidation Margin
A reserve calculated from collateral and leverage: collateral x (25% x leverage / maxLeverage). This is the threshold below which liquidation triggers.
Maker / Taker
Fee classification based on OI impact. Makers reduce OI imbalance (lower fee: 0.05%). Takers increase it (higher fee: 0.1%). Maker rate also requires leverage of 20x or below.
Open Interest (OI)
Total notional value of all outstanding positions. Tracked per pair, per direction (long/short). The protocol caps OI at $10M per pair per direction.
Oracle
The off-chain system that computes dominance values from exchange price feeds and publishes them on-chain via ECDSA-signed messages.
Position Size
Collateral multiplied by leverage. A $100 collateral position at 50x has a $5,000 position size. Fees are charged on position size, not collateral alone.
Slippage
The maximum acceptable difference between expected and actual execution price. Set when submitting a market order.
Take-Profit (TP) / Stop-Loss (SL)
Automated price triggers. TP closes your position when profit reaches a target. SL closes it to cap losses. Both execute the full position. TP is capped at 900% of collateral.
Vault
The ERC-4626 USDC pool that acts as collective counterparty to all trades. LPs deposit USDC, receive $dfUSDC shares, and earn trading fees.