Gearbox Markets Overview

Gearbox Markets is a pooled lending model where multiple lenders deposit into a shared liquidity Pool, and borrowers open Credit Accounts to access leverage. It is one of two lending models built on the Gearbox Credit Account primitive — the other being Intent-Based (P2P) Lending.

The Wholesale Bank Model

Think of a Gearbox Market as a wholesale bank:

Pool — a passive ERC-4626 vault. Many lenders deposit into the same Pool and receive Diesel Tokens (dUSDC, dWETH) — yield-bearing receipts whose value appreciates as borrowers pay interest.
Credit Managers — act as policy keepers. Each Credit Manager defines a specific lending strategy: which collateral tokens are accepted, which DeFi protocols can be used, what leverage is allowed. A single Pool can fund multiple Credit Managers, each with an isolated Debt Ceiling.
Credit Accounts — isolated smart contract wallets where borrowers deposit collateral and deploy borrowed funds. All DeFi operations happen inside the Credit Account. The Credit Manager checks solvency after every operation.

Risk Isolation

Unlike monolithic lending protocols where bad debt in one asset drains the entire pool, Gearbox isolates risk via Debt Ceilings:

A Pool holds $100M USDC
$80M allocated to a Blue Chip strategy (low risk)
$10M allocated to an Emerging Assets strategy (high risk)
If the Emerging Assets strategy fails, the loss is capped at $10M — the remaining $90M is mathematically isolated

Lenders earn blended yield from all strategies but are protected from tail risk of any single one.

Quotas: Per-Token Risk Pricing

Quotas are unique to Gearbox Markets. They solve two problems at once:

Concentration limits — a hard cap on how much of any single collateral token can back debt across the Pool. This prevents over-concentration in volatile assets.

Risk-priced interest — each collateral token carries its own Quota Rate on top of the base Pool rate. Riskier tokens cost more to use as collateral.

Total Borrow APR = Base Rate (from Pool utilization) + Quota Rate (per collateral token)

For example, using WETH as collateral might add +1% to the borrow rate, while using a governance token adds +5%.

Unified Yield for Lenders

Lenders don't need to choose which strategy to back. The Diesel Token abstracts everything:

Deposit USDC into the Pool → receive dUSDC
Interest from all Credit Managers flows back to the Pool
dUSDC exchange rate appreciates over time
Withdraw anytime (subject to available liquidity)

Market Curators

Any entity — institution, DAO, individual — can permissionlessly deploy a Credit Manager and become a Market Curator. Curators manage parameters, not funds:

Collateral tokens and liquidation thresholds
Enabled DeFi adapters (Uniswap, Curve, Lido, etc.)
Fee structure and debt limits
Interest rate curve parameters

The system is fully non-custodial. See Gearbox Permissionless for how this works.

Alternative: Intent-Based (P2P) Lending

Gearbox Markets uses pooled liquidity. But the Credit Account primitive also enables a fundamentally different model: peer-to-peer lending where a single lender and a single borrower agree on terms directly.

	Gearbox Markets (Pooled)	Intent-Based (P2P)
Liquidity	Many lenders → shared Pool	One lender ↔ one borrower
Rates	Dynamic (utilization-based)	Fixed or reference-based (LIBOR + 2%)
Risk	Socialized across Pool LPs	Isolated per deal
Collateral	Curator-defined allowlist	Custom per agreement
Best for	DeFi-native strategies, retail	Institutional, RWA, bespoke terms

In both models, the borrower operates through a Credit Account — the same solvency checks, adapters, and liquidation mechanics apply. The difference is how the capital is sourced.

What's in This Section

Concepts — Markets, Credit Accounts, Multicall System, Health Factor & Risk
Getting Started — Set up the TypeScript SDK
Markets — Query pools, rates, quotas, and insurance state
Credit Accounts — Open, manage, and close positions
Smart Contracts — Contract reference (methods, events, parameters)
Guides — Frontend, backend, and bot tutorials