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The substantial borrowing and issuance fees levied by platforms have been one of the major issues with crypto loans for years. Many of these services have predatory interest rates and are created with the developer team’s profit as their primary concern rather than the users’. However, a brand-new platform called Liquity has just emerged, and it has the power to transform the crypto-lending industry completely.
About Liquity
Liquity is a completely automated and non-governance decentralized borrowing mechanism. To achieve the highest level of capital efficiency and user-friendliness, it is designed to allow permissionless lending of its native token using third-party frontends.
The back story of Liquity
Liquity was launched in late 2019 when Robert Lauko and Rick Pardoe came together to establish the platform. Currently, Robert Lauko serves as the head of research, while Rick Pardoe is the lead engineer. CEO Michael Svoboda, who has previously held CEO positions in various blockchain companies, is also part of the development team. In 2021, Liquity officially launched its services.
The project was inspired by the vision of creating a more efficient and user-friendly borrowing platform, unlike other borrowing platforms that rely on centralized stablecoins such as USDC. Liquity’s founders aimed to provide borrowers with a decentralized stablecoin pegged to the USD; this aspiration gave rise to the development of LUSD.
Advantages of Liquity
Liquity offers several advantages beyond addressing the challenges of decentralized borrowing. The platform incorporates beneficial features to enhance the user experience, including:
- 0% interest rate
During the Recovery Mode, Liquity implements a 0% interest rate. This mode aims to incentivize borrowers to take actions that quickly raise the Total Collateral Ratio (TCR) above 150% and motivate LUSD holders to replenish the Stability Pool. It serves as an encouragement for collateral top-ups and debt repayment while also acting as a self-negating deterrent.
- The collateral ratio of 110%
Liquity establishes good rules for loans issued through its protocol. Unlike traditional repayment schedules, users can keep their Trove open and repay the debt at their convenience, as long as they maintain a collateral ratio of 110%. This flexibility allows borrowers to manage their repayments according to their individual circumstances.
- Governance-free
The protocol’s governance-free nature is another key benefit. Liquity operates without relying on human governance and voting for monetary interventions. Instead, the protocol’s parameters are either predetermined and immutable or controlled by the protocol itself through an algorithm. This eliminates the need for persuading token holders to approve proposals or implement changes, as the protocol autonomously manages its operations.
Tokenomics
LQTY functions as the secondary token within the Liquity protocol, with a maximum supply of 100 million coins. Currently, there are approximately 91.4 million coins in circulation. Following its launch, LQTY achieved its all-time high value of $146.94 on April 5, 2021, but also experienced its all-time low point at $0.543990 per coin on November 14, 2022.
During the initial distribution, 33.9% of the available coins were allocated to investors, 33.3% to the community, 23.7% to the team and advisors, 6.1% to the Liquity AG Endowment, 2% to the Community Reserve, and 1% to service providers. However, except for the coins distributed to the community, all LQTY tokens were subjected to a 1-year lockup period.
How to buy Liquity (LQTY) Tokens in India?
Below are a few simple steps you can follow and buy the Liquity Token in India with WazirX, India’s most trusted and widely used crypto exchange.
The best way to buy Liquity Tokens is using P2P trade. To get answers to all your queries related to the P2P trade, click here!
Bonus point: INR Deposits are also LIVE on the WazirX platform. Now, you can buy Liquity Tokens using INR.
Step 1 – Sign-Up on the WazirX platform.
To begin buying and selling Liquity Token, you are required to create an account on the WazirX platform by signing up. Also, you can directly Log-in if you have an account already on the platform.
For your reference, here’s how you can open an account on WazirX.
Step 2 – Set up your account security by verifying your email address.
This step is about verifying your email address. After you sign up on the WazirX platform, you’ll get a verification link on your registered email. By clicking on that link, you’ll get two options to ensure the security of your account – the authenticator app and mobile SMS.
Note: The authenticator app is a more secure way to stay safe when compared to mobile SMS because there’s a risk of delayed reception or SIM card hacking.
Step 3 – Complete the KYC process.
After choosing your country, you can proceed with completing the KYC process. Click here for a detailed overview.
Note: You must complete your KYC to be able to trade P2P or withdraw funds on the WazirX app.
Step 4 – Add funds to your WazirX account using P2P.
After integrating your bank account into your WazirX account, you can buy USDT through P2P to the WazirX wallet. The USDT will act as funds to help you buy your favorite cryptos.
Step 5 – Finally, buy Liquity on WazirX.
You can now easily purchase Liquity Tokens using P2P trade on the platform. You can buy Liquity to USDT here.
After logging in to your WazirX account, you can choose USDT from the “Exchange” tab. You can also check all the price charts, order book data, and an order input form on the right side of the screen.
Click “Buy” after entering the amount and checking the total USDT amount to be paid.
Your order will be placed according to the price you have input. A seller willing to sell at a price will be notified, and then you can exchange the tokens using P2P.
It might take a few minutes for the order to be completed, but as soon as it is executed, you will receive the Liquity Coins you purchased in your WazirX wallet.
Happy Trading!
Disclaimer: Cryptocurrency is not a legal tender and is currently unregulated. Kindly ensure that you undertake sufficient risk assessment when trading cryptocurrencies as they are often subject to high price volatility. The information provided in this section doesn't represent any investment advice or WazirX's official position. WazirX reserves the right in its sole discretion to amend or change this blog post at any time and for any reasons without prior notice.
