Liquid Loans is the first truly decentralized lending protocol built specifically and exclusively for PulseChain.
Liquid Loans allows you to draw 0% interest-free loans using the PulseChain native token (PLS) as collateral.
Loans are paid out in USDL – a USD value pegged stablecoin – with a minimum collateral ratio required for a loan of 110%.
The repayment schedule is timeless.
Loans are secured by a Stability Pool containing USDL and by fellow borrowers collectively acting as guarantors of last resort.
Liquid Loans as a protocol is a non-custodial, immutable, and governance-free lending protocol. The protocol is a finished product with no admin keys.
The Liquid Loans protocol was developed to allow owners of PLS a method of extracting value from their holdings, without the need to ever sell.
By locking up PLS and minting USDL, a PLS holder can take a 0% interest-free loan against their holdings, on a timeless repayment schedule.
The protocol smart contract code is completely immutable and therefore has no owner or operator. There are no admin keys, and nobody can alter the rules of the system in any way once deployed.
USDL is the USD value pegged stablecoin used to pay out loans on the protocol. It is a native stablecoin that aims to always be worth one US dollar and at any time it can be redeemed against the underlying collateral at face value.
LOAN captures the fee revenue that is generated by the system and incentivizes early adopters. You earn LOAN by providing USDL stablecoin to the Stability Pool in exchange for rewards. You can also stake your LOAN tokens to earn the revenue paid for borrowing or redeeming USDL.
0% interest rate – as a borrower, there’s no need to worry about constantly accruing debt
110% MCR – a low Minimum Collateral Ratio means more efficient usage of your deposited PLS
Governance free – all operations are algorithmic and fully automated, and protocol parameters are set at time of deployment
Directly redeemable – the protocol allows you to exchange 1 USDL stablecoin for USD $1 worth of PLS at any time
Fully decentralized – the contracts have no admin keys and can be accessible via other front ends, making it censorship resistant
As a borrower, you can take a loan against your existing PLS. To do this, you deposit your PLS into a contract called a Vault, which in turn mints the USDL stablecoin. Use your USDL for a variety of personal uses, or reinvest into the system to provide stability and take advantage of another journey on the ecosystem.
As a holder of USDL, you can earn income by providing stability to the Liquid Loans ecosystem. Invest and achieve a return on your USDL using gains earned through liquidation events plus incentives provided in the form of LOAN tokens.
As a holder of LOAN, these tokens can be staked for rewards. Earnings are generated from the borrowing and redemption fees, and are provided in the same proportion as the amount you have staked in the staking pool.
To redeem PLS, you simply provide the appropriate amount of USDL. The protocol allows you to exchange 1 USDL stablecoin for USD $1 worth of PLS.
There is a one-off fee whenever you borrow and redeem using the system. Fee range is between 0.5% and 5.0% depending on demand for loans.
Loans issued by the protocol are timeless, and have no repayment schedule. You can leave your Vault open and repay your debt at any time, as long as you maintain a minimum collateral ratio of at least 110%.
Yes, Liquid Loans is currently on the PulseChain testnet and you can access the front end dapp here.
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