TORQ
TORQ explains governed credit operations for digital and tokenized assets.
- 02 OCT 2026
- 6 min read
Why credit needs operating controls
A credit mandate needs rules that hold during each action. See how TORQ connects roles, draw limits, valuation checks, exit queues and verified records to a facility.
A credit policy has to survive daily execution. A borrower draw needs valid valuation context and available capacity. An allocation needs approved scope. A withdrawal needs cash or a recorded claim. TORQ ties these checks to the facility so participants can inspect both the rule and the result.
TORQ's documented V2 model places those controls around a facility. A vault provides bounded capital, an attached market executes borrowing, and each role reads the resulting state through the same indexed application record. The exact controls depend on the facility's configuration and assigned authority.
What are credit operating controls.
Credit operating controls are enforceable conditions on who may act, how much value may move, which data can support the action, and how the result is checked. They turn a mandate into decisions that can be reviewed before and after execution.
- Can this borrower draw?
- TORQ control: Borrower access, collateral health, valuation context and the chosen credit facility are checked.
- Why it matters: A draw must fit the approved route and current risk state.
- How much can move?
- TORQ control: The draw is checked against available vault capacity and any configured transaction or rolling-window caps.
- Why it matters: One request cannot bypass the limits that apply to its facility.
- Can capital exit now?
- TORQ control: Available cash and redemption claims are distinguished. Unmet claims join the queue.
- Why it matters: An investor can see a claim without assuming immediate cash settlement.
- Who may change policy?
- TORQ control: Roles, approval scope and applicable timelocks govern sensitive changes.
- Why it matters: Operational authority is assigned rather than inferred from access to a screen.
- Did the action complete?
- TORQ control: Confirmed activity is indexed and projected into the shared read model.
- Why it matters: Borrower, investor and operator views can be checked against one persisted state.
Set facility boundaries.
A TORQ vault defines a capital commitment and the markets it may support. The vault-market attachment can set a capital envelope and constrain allocation increases, individual draws and draws within a time window. The market handles borrower-facing debt, collateral, rates and valuation inputs.
This separation gives an asset manager a specific question to answer: which vault commitment is funding this borrower route, under which limits? A shared execution market does not make every vault's capital available to every borrower.
A borrower draw must pass current checks.
Before increasing debt, the market checks borrower access, the selected vault attachment, collateral health, the oracle version and the current risk epoch. The vault also checks capacity, cash reserved for exits, recipient policy, transaction limits and rolling-window limits. A failed check blocks the draw.
For example, a borrower may have collateral and an unused line, yet the valuation used for a new draw may be stale. The correct outcome is to stop that risk-increasing action until the required price or net asset value evidence is current. An apparent balance alone is not permission to lend.
Withdrawal requests need an explicit cash path.
Vault shares are not a promise of instant exit. When cash is available, a redemption can be paid. An unmet amount becomes a queued claim, with order and reserved cash recorded. TORQ's V2 vault path rejects out-of-order fulfillment and keeps queued-exit cash separate.
In a Senior and Junior vault, stress or impairment can also change deposit and withdrawal behavior. Review the actual tranche rules, queue state and available cash before treating a displayed balance as withdrawable liquidity.
Roles limit who can change a credit mandate.
An asset manager's allocator can allocate or deallocate within an approved vault-market scope and its caps. That role does not gain authority to deploy a vault, change employee permissions, redirect payouts or control recovery. Those actions remain with the appropriate administrator and approval path.
Sensitive changes can also have a timelock. A queued change, an executable change and an executed change are different states. Review who proposed it, which terms it affects, when it can take effect and whether the final state was indexed.
Controls matter most when a facility is stressed.
A deteriorating collateral position can require a restricted draw path, liquidation review or loss recognition. Recovery then follows the originating vault's accounting and the permitted recovery process. Defined roles and records help identify who may act and which capital bears the outcome.
These controls reduce ambiguity and are designed to block an action outside its configured scope. They do not eliminate borrower default, valuation error, illiquidity, liquidation shortfall or investor loss. The asset manager, borrower, reporter and other assigned parties retain their respective duties.
What should you check before operating a facility.
The strongest control is one you can identify in the actual configuration and verify after use. Ask for the facility's current terms and records, not a generic feature list.
- Which vault funds the line, which market executes it, and who may attach or allocate capital?
- What are the borrower access, collateral, draw, recipient and rolling-window limits?
- Which price or net asset value source is required, and what happens when it is stale?
- When can investors redeem, how are unmet requests queued, and which cash is reserved?
- Who can change limits, roles, payouts and recovery terms, and which approvals or timelocks apply?
- How will your team verify a confirmed action in the canonical application record?
