Decentralized finance protocols, such as decentralized exchanges and lending protocols, operate by utilizing a liquidity pool concept. Liquidity pools are smart contracts that lock assets for specific purposes. On lending protocols, liquidity is utilized for loans, while on DEXs it is used for exchange. Liquidity providers or lenders in these protocols lock their assets in pools and earn interest from trades and loans performed with these assets.

Primex operates in a similar way, where Lenders provide liquidity to special types of pools known as Credit Buckets and earn interest based on the borrowing fees paid by Traders. The core difference between Credit Buckets and lending pools is the purpose of liquidity usage. Lending pools transfer liquidity to borrowers' wallets, and the funds can be used for any purpose, while Primex Credit Buckets are designed to provide liquidity only for leveraged operations on specific terms. This focus allows the building of various margin services with a predictable level of risk. The Primex protocol offers multiple Credit Buckets with different rules, conditions, and levels of risk.

In the Primex protocol, anyone can become a Lender, including individuals and institutional asset managers. Lenders enjoy higher interest rates in comparison to regular lending pools, risk diversification, and more precise risk control.

For details on the Lender workflows, see the Lender Guides section.