Overview
What Is Liquidium?
Liquidium is a peer-to-peer Bitcoin lending platform that leverages unique Bitcoin-based assets such as Ordinal Inscriptions (Ordinals) and Runes as collateral. The platform facilitates borrowing and lending of Bitcoin in a secure and non-custodial manner through Partially Signed Bitcoin Transactions (PSBTs) and Discreet Log Contracts (DLCs) on the Bitcoin Layer-1 network. Users can borrow Bitcoin against their assets without selling them, and lenders can earn yield by lending their Bitcoin.
What Makes Liquidium Unique?
Liquidium stands out as the first DeFi protocol built entirely on Bitcoin. It utilizes innovative financial mechanisms, such as PSBTs and DLCs, to ensure secure and transparent transactions. The platform's use of Bitcoin-based collateral like Ordinals and Runes provides unique opportunities for Bitcoin holders to unlock liquidity without relinquishing ownership. Additionally, Liquidium's governance token, LIQUIDIUM•TOKEN, promotes decentralization and community involvement, further distinguishing it in the Bitcoin DeFi space.
History of Liquidium
Founded in August 2022 by Robin Obermaier, Julian Mezger, and Peter Giammanco, Liquidium initially launched as the first lending protocol on Stacks, a Bitcoin side-chain. With the introduction of Bitcoin Ordinals in January 2023, the team pivoted to build directly on the Bitcoin Layer-1 network. The first version of Liquidium on Bitcoin launched on mainnet in July 2023. Since then, the platform has facilitated over 2206 BTC (~ $150Mn USD) in total loan volume, executed over 33,000 loans, and paid over 39 BTC (~ $2.6Mn USD) in yield to lenders (as of July 24, 2024). The LIQUIDIUM•TOKEN, launched on July 22nd, 2024, is the first governance token on the Runes token standard on Bitcoin.
What's Next for Liquidium?
Liquidium's roadmap is focused on enhancing the platform's functionality and user experience:
Lending Liquidity Pools for Fungible Tokens:
Implement Aave-like lending pools on Bitcoin for fungible tokens (e.g., RUNES, BTC).
Enable users to lend tokens to earn interest and use them as collateral.
Allow borrowing against lending positions.
Aim for best-in-class user experience for fungible token lending.
Introduce a more capital-efficient model than peer-to-peer loans.
Enable perpetual loans with reduced lender risk and potentially lower borrower interest rates.
Security Module for P2Pool Model:
Develop a security module as a final protection layer for the pools.
Allow users to stake tokens in the security module to earn yield while securing the protocol.
Instant P2P Loans:
Implement a system for instant peer-to-peer loans without lender countersignature delays.
Enable lenders to deposit Bitcoin in a derived address for automatic countersigning.
Improve user experience and address the issue of 'dead' offers in the order book.
Loan Extensions:
Develop functionality for borrowers to request loan extensions.
Allow lenders to agree to extend loans.
Implement automatic doubling of loan duration and interest upon mutual agreement.
Decentralized Oracle for DLC:
Create a system allowing multiple participants to run nodes for the oracle.
Enhance security and reduce centralization of the oracle system.
Enhanced Lender Rating System:
Implement a new rating system with rating buckets.
Include various factors such as loan rejection rate and time to counter-sign loans.
What Can Your Coin/Token Be Used For?
The LIQUIDIUM•TOKEN serves multiple purposes within the Liquidium ecosystem. Primarily, it is used for governance, allowing token holders to participate in decision-making processes that shape the future of the platform. Additionally, the token can be used to unlock premium features, receive discounts on platform fees, and earn rewards through various incentive programs. By holding and using LIQUIDIUM•TOKEN, users can actively contribute to and benefit from the growth and success of Liquidium.
Learn more about Bitcoin Runes: https://docs.ordinals.com/runes.html
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