The key difference between Primex and lending protocols is how the Lender's liquidity is utilized. On Primex, borrowers can only use the liquidity for specific purposes, such as leveraged trading on DEXs. Later on, a few new options will be introduced to achieve DeFi-composability.
The Lender's liquidity is not transferred to external borrowers' wallets but instead stored in Primex smart contracts before the trade closes. This way, Primex eliminates the need for overcollateralization, allowing Primex Lenders to benefit from improved liquidity utilization, resulting in higher interest rates.