I’m reading Marlowe tutorial, specifically figure 5 in this page
It introduces a guarantor who deposit the whole loan amount upfront, which will be used to pay investor if issuer defaults. I find that is a little bit strange. Why does guarantor loan the money to issuer directly? Note guarantor is taking the same amount of risk as lending to the issuer while getting less reward (because part of interests go to investor)
This does not make sense to me. Or does it?