Supplying and Earning

How do I supply?

Navigate to the "Assets to the supply" section and click on "Supply" for the asset you want to deposit. Select the amount you want to supply and submit your transaction by approving it in your Cardano browser wallet. Once the transaction is confirmed, your supplied liquidity is successfully deposited and you begin earning interest. *Be sure to set your browser wallet's collateral.

How much will I earn?

qTokens holders perpetually earn interest based on variable borrow rates (which are continuously updated based on supply and demand conditions per market).

Suppliers earn interest paid by borrowers corresponding to the average borrow rate multiplied by the utilization rate. A higher utilization rate for a market equates to higher interest earned by suppliers (and paid by borrowers).

Each supported asset on the protocol has an individual market of supply and demand with its own APY (Annual Percentage Yield) which continuously updates every few minutes (based on the amount of liquidity supplied compared to borrowed).

Is there a minimum or maximum amount to supply?

There is a minimum of ~$25-30 and maximum according to the market your want to supply.

What is the cost of using the Liqwid protocol?

Using the protocol requires transactions on the Cardano blockchain so transaction fees for usage, denominated in ADA, which vary based on transaction complexity.

The protocol has been optimized to enable the lowest possible transaction fees for users completing market actions (Supply, Borrow, Repay, Withdraw).

Where are my supplied assets located?

Supplied assets are always stored on-chain in a Plutus smart contract. The on-chain validator code of the smart contract is audited by third-party auditors. You can withdraw your assets from a market at any time or transfer a tokenized (qTokens) version of your supplier position. As fungible Cardano native assets, qTokens can be transferred and traded as ADA or any other Cardano native token.

Can I stake ADA while I supply them in the LQ protocol?

Yes, ADA suppliers can stake their coins and receive rewards in their staked wallet while they are supplying to the ADA market.

The value of the ADA deposited by the supplier will increase over time due to the accrued interest. The staking reward for ADA will accrue in a user’s staked wallet and not impact the value of supplied ADA.

Is there any risk?

No smart contract protocol can be considered completely risk free. The risks related to the Liqwid protocol are the smart contract risk (risk of a bug within the codebase) and liquidation risk (risk of collateral liquidation event). Security of the protocol is the Core Team's primary focus.

Tangible steps to minimize the risk have been completed; the smart contract code has undergone an external security audit and the Core Team has completed exhaustive internal testing of on-chain contract functions, off-chain components and infrastructure.

Can I earn LQ for supplying assets on Liqwid.

LQ tokens are allocated every epoch between the suppliers and the borrowers depending on the current usage incentive program voted by the Liqwid DAO.

How do I withdraw my assets?

To withdraw navigate to the “Your supplies” section and click on “Withdraw”. Select the amount you want to withdraw and submit your transaction by approving it in your Cardano browser wallet. You can also use your qTokens as liquidity without withdrawing by locking it as collateral to borrow assets from the protocol.

You will need to confirm there is sufficient liquidity (not borrowed) to complete your withdraw transaction, if there is not you would need to wait for more liquidity from supplier deposits or borrower loan repayments.

Can I opt-out my assets from being used as a collateral?

No, although you can specify which of your supplied assets are used as collateral in the "Collateral distribution" section of the "Borrow" modal.

You can withdraw your supplied assets without opting out of using them as collateral, provided those assets are not actively being used to borrow and the withdrawal would trigger a liquidation event on your loan position by reducing your Health factor beneath 1.