Bankless · Wednesday, July 29, 2026
Paul Frambot argues that fixed-rate, fixed-term lending, represented by a zero-coupon obligation, is the true primitive for finance, superior to variable-rate models. He believes this construct is simpler and more fundamental, but its DeFi implementation was hindered by technical limitations and market immaturity.
“I think fixed rate, fixed term is the right primitive for financing. It is a true primitive. It is the true, and it's the only true primitive. And it's a deep, deep conviction that I have.”
“Because if you have variable rate, What does it vary on, right? What is the function? And the function, the answer to that is that it's arbitrary. You rely on something to say, what is the rate? Which makes it not a primitive.”
“A primitive does not rely on anything for its existence, right? Whereas a fixed rate, fixed rate market, the primitive is a zero coupon obligation, which is an extremely simple construct, much simpler than the mess that a lending pool is, because a lending pool is a mess, right?”