Here is the general story. Borrowers and lenders enter a loan contract. Specifically, they swap a forward contract based token called "ayToken" with "Token". "Token" is the underlying asset. For example, they swap ayUSD with USD. More generally, the lender lends out "Tokens" and obtains "ayToken" in return. The price of "Token" is lower than its par value. The contract starts when a lender deposits "Token" in an ALEX pool. Then, upon expiration, the lender redeems the underlying asset, "Token", at par value. Because the lender lent out their "Token" at discounted price some time ago, and now redeems "Token" for par value, there is a profit. Pretty nice!