Liquity
Crypto Overview
Overview
Liquity is a decentralized borrowing protocol that allows users to draw interest-free loans against Ether used as collateral. Loans are paid out in LUSD (a USD pegged stablecoin) and need to maintain a minimum collateral ratio of 110%.
Purpose and Utility
The LQTY token serves as the protocol's governance and revenue-sharing token. LQTY stakers receive protocol fees generated from borrowing operations and liquidations. The token also grants voting rights on protocol parameters.
Business Model Analysis
The core business model revolves around lending and borrowing operations, with revenue generation through fees. The protocol charges a one-time borrowing fee (which varies based on system conditions) and a liquidation fee. These fees are distributed to LQTY stakers.
Real-World Adoption
As of 2024, Liquity has over $400 million in Total Value Locked (TVL) and has processed billions in loan volume. The protocol maintains active development and community engagement.
Platform Development
The protocol demonstrates ongoing development activity with regular updates and improvements. The core team maintains transparency in their operations and development roadmap.
Token Distribution
LQTY had no pre-mine or ICO. The token distribution was designed to be fair, with tokens primarily distributed through protocol usage and development incentives.
Crypto Impact
To assign a comfort level investing in Liquity from a halal perspective we need to determine whether it has a net positive or negative impact.
Towards this end, the table below is used to tally all the positive and negative considerations our members can think of related to Liquity.
If you don’t see something that should be listed, positive or negative, feel free to submit your own contribution using the button “Contribute”.
We will review your contribution for accuracy before publication.
Importantly, you can review listed contributions and vote on which one you think has the greatest impact, positive or negative.
You only have one vote per asset so use it wisely.
You can change your vote if you change your mind.