**What is Liqwid Finance?**

Welcome to Liqwid Finance! Think of us as Cardano’s decentralized money market—a place where your crypto assets work for you without the hassles of traditional banking.

**The Basics**

**Decentralized & Automated:**

Liqwid is Cardano’s largest lending protocol, operating entirely through smart contracts. There’s no paperwork, no credit checks, and you remain in complete control of your assets.

**Dual Functionality:**

- You can be both a lender and a borrower.

**As a Lender:**

- Deposit your crypto (like ADA or stablecoins) and earn interest—all while keeping your ADA staking rewards.

**As a Borrower:**

- Use your supplied assets as collateral to borrow stablecoins without selling your crypto. This enables you to access liquidity while still benefiting from your original assets.



**How It Works**

**Lending Made Simple:**

- Deposit your crypto and receive tokens (qTokens) that represent your deposit.
- These tokens continuously earn interest as borrowers use your assets.

**Borrowing with Confidence:**

- Use your deposited crypto as collateral to borrow up to 80.9% of its value.
- All transactions happen automatically through secure, battle-tested smart contracts.

**Key Reasons to Use Liqwid**

**1. Earn While You Hold:**

- Generate interest on your assets without sacrificing ADA staking rewards.
- Access liquidity without selling:
- Borrow funds using your crypto as collateral—no need to liquidate your positions.

**2. Build Advanced Strategies:**

- Whether you’re lending or borrowing, Liqwid lets you develop sophisticated strategies to grow your portfolio.
- Scale & Security

**3. Proven and Trusted:**

- With over $100 million in total value locked, Liqwid stands as the leading lending protocol on Cardano.

**Community & Governance:**

- Our community governs all major decisions, ensuring that the platform evolves in line with user needs and market trends.



**Ready to Learn More?**

- Let’s dive into how money markets work and get you started with your first transaction.

What is Liqwid Finance?

**What is Decentralized Lending?**

**The Basics**

Imagine a bank where everything happens automatically through smart contracts - no paperwork, no credit checks, and no middlemen. That's what Liqwid offers on Cardano.


**How It Works**

**For Suppliers:**

- Deposit your crypto assets
- Earn interest automatically
- Withdraw anytime you want
- Keep full control of your funds

**For Borrowers:**

- Supply collateral
- Borrow instantly
- No credit checks needed
- Flexible repayment options


**Interest Rates:**

**Supply and Demand**

Interest rates adjust automatically based on usage:
- High demand = Higher rates
- Low demand = Lower rates

Think of it like a self-balancing scale that keeps the market healthy!


**The Power of Non-Custodial**

**When using Liqwid:**

- Your assets stay yours
- Nobody holds your funds
- Smart contracts handle everything
- You maintain control at all times


Understanding Money Markets

**What is a Lombard Loan?**

Traditionally, A Lombard Loan, also known as Lombard Credit, is a type of secured loan, in which the loan amount is secured by assets, which are called "collaterals".

Liqwid offers the the same features as a Lombard loan as it lets you borrow against your crypto without selling it.

**Real-World Example**

Imagine you hold 10,000 ADA worth $5,000. You need $2,000 for an investment opportunity, but don't want to sell your ADA. 

**With a Lombard loan on Liqwid, you can:**

- Keep your ADA (and keep earning staking rewards!)
- Borrow stablecoins against your ADA placed as collateral
- Maintain upside exposure if ADA price rises
- Access funding to liquidity needs or to invest more
- Access funds without triggering a taxable event


**Key Benefits**

- Access liquidity while keeping your crypto
- No fixed repayment schedule
- Competitive interest rates
- Keep earning staking rewards on ADA

Benefits of a Lombard Loan?

<img src="https://res.cloudinary.com/djcg0daie/image/upload/v1759317267/zjapk/Borrow_smart._Watch_your_Health_Factor..png.jpg">Loan-to-Value (LTV): Borrow size ÷ Collateral value. Health Factor (HF): Liquidation threshold ÷ Current LTV.<ul><li>HF &gt; 1 = safe.</li><li>HF ≤ 1 = liquidation risk.</li></ul>Why aim for a 1.5 Health Factor? It’s just a bigger safety cushion. Think of 80% LTV as the “cliff edge.” Keep in mind this formula as we work through an example: HF = Liquidation Threshold ÷ Current LTV Example:At 60% LTV, you would have a HF of 1.33, this would mean ~25% ADA drop pushes you over. As 0.60 / (1− 0.25) = 0.80 - the liquidation point or cliff edge. If you keep a HF of 1.5, you’re at ~53% LTV, A HF of 1.5 = 0.8 / 0.53, so you can stomach a ~33% drop before trouble As 0.53 / (1-0.33) = 0.791 or ~0.80Dual perspective: - Suppliers: earn more when utilization is high. - Borrowers: pay more when utilization is high.

Risk Management: LTV, Health Factor, and Liquidation

**How to Use Leverage on Liqwid**

**What is Leverage?**

Leverage allows you to increase your exposure to an asset by borrowing against your existing holdings. Think of it as a way to amplify your position while keeping your initial investment unchanged. Let’s walk through an example:

**Simple Example**

Let's walk through a basic leverage strategy:

**Initial Position:**

You supply 2,000 ADA (worth $1,000 at $0.50 each)
This is your base position


**Adding Leverage:**

- Borrow $500 worth of DJED stablecoins (50% LTV for safety)
- Use borrowed DJED to buy more ADA
- Purchase 1,000 more ADA ($500 ÷ $0.50)


**Final Position:**

- Total ADA held: 3,000
- Original investment: $1,000 for 2000 ADA
- Borrowed amount: $500 for 500 DJED
- Total exposure: $1,500 for 3000 ADA


**Key Points to Remember**

- Start with a lower LTV to keep a low to medium risk position
- Monitor your health factor closely
- Have a plan for different market scenarios
- Understand that leverage amplifies both gains and losses

Usecase 1: Using Leverage

**Accessing Immediate Liquidity**

**Quick Access to Funds**

Need quick access to liquidity without selling your crypto? Here's how Liqwid can help.

**Real-World Example**

Let's say you have an unexpected expense:

**Your Position:**

- You hold 5,000 ADA
- You need $1,000 for urgent bills
- You believe ADA price will rise

**The Solution:**

- Supply your 5,000 ADA as collateral
- Borrow $1,000 in stablecoins
- Pay only ~1.5% interest over 3 months
- Keep your full ADA exposure

**The Outcome:**

- Get immediate liquidity
- No selling pressure
- No lengthy approval process
- Keep upside potential

**Key Benefits**

- Access funds in minutes
- No credit checks needed
- Keep your crypto position
- Flexible repayment options

Usecase 2: Access Liquidity Immediately

**What is Portfolio Diversification?**

Using Liqwid, you can access different DeFi opportunities while keeping your original crypto position. This helps spread risk and potentially increase returns.

**Step-by-Step Example**

Let's walk through a simple diversification strategy:

**Starting Position:**

You have 4,000 ADA (worth $2,000 at $0.50 each)

Want to explore other DeFi opportunities


**Using Liqwid:**

- Supply your ADA as collateral
- Borrow $800 in stablecoins (40% LTV)
- Use these stablecoins in other DeFi platforms


**Example Calculation:**

- Earn 10% APR in new yield farm = +$80/year
- Pay 5% interest on borrowed $800 = -$40/year
- Net profit = +$40/year (assuming stable prices)

**Important Considerations**

- Monitor your health factor
- Watch for impermanent loss risks
- Keep track of changing yields
- Stay within safe borrowing **limits**

Usecase 3: Portfolio Diversification

Use these questions to test your understanding of Liqwid Finance and its key features.

Practice Questions

Introduction to Liqwid Finance

**Navigation Overview – Liqwid Dashboard**

Welcome to your Liqwid Dashboard, your all-in-one hub for managing deposits, loans, and overall performance. 
Here’s what you’ll see at a glance:

- Supplies – The total assets you’ve deposited to earn interest
- Borrowers – How much you currently owe on any open loans
- Net APY – Your overall earnings after subtracting costs
- Health Factor – A safety indicator for your loan position

Keep an eye on these sections to stay informed about your positions, track your returns, and manage your borrowing risk.

Navigation Overview

**Markets Page Overview**

Welcome to the Liqwid Markets page—your go-to spot for exploring each asset’s current rates and liquidity. 

Here’s what you’ll find:

- Asset List – Quickly check each token’s supply and borrow APY
- Oracle Price – See the real-time price used to calculate collateral and interest
- Total Supply & Total Liquidity – Gauge the market depth at a glance
- Accepted as Collateral – Indicates you can use that asset to secure a loan
- Details & Advanced Data – Click through to view liquidation thresholds, max LTV, and other risk metrics

Once you’re comfortable here, we’ll head over to the Analytics page to dive deeper into historical data and trends.

Markets Page

**Analytics Page Overview**

Ready for a deeper look at market activity? 

The Analytics page helps you track real-time data and historical trends:

- Oracle Tab – Check live price updates used to calculate your collateral and interest
- Info Panel – View total supplies, utilization rates, and other key stats at a glance
- Liquidity Tab – Compare current supply and borrow levels for each asset
- Time Filters – Analyze data over periods ranging from 1 day to 1 year, so you can spot trends and refine your strategy

Use these insights to make more informed decisions about supplying, borrowing, and managing your risk on Liqwid.

 Analytics Page

**Staking Page Overview**

The Staking page gives you a clear snapshot of your LQ holdings and how they’re put to work:

- Balance & Voting Power – See your total LQ balance, how much is staked, and the voting power you have at the top
- Manage Your Stake – Use the “Create Stake” or “Modify Stake” options to adjust your positions
- Delegated Power – Quickly check who you’re delegating to, and on the right, view key metrics like LQ’s price, supply, and total amount staked

Staking your LQ is a great way to earn additional rewards while contributing to Liqwid’s governance and long-term success.

Staking Page

**Governance Page Overview**

Welcome to Liqwid’s Governance hub, where you can actively shape the protocol’s future:

- LQ Balance & Voting Power – Check your staked LQ on the left, stake more, or delegate to someone you trust
- Proposals & Executions – Browse the latest proposals, see their status, and review execution details
- Voting Filters – Sort proposals by category or status, and vote directly or delegate your vote to a third party
- Make your voice heard—your participation drives Liqwid’s continuous growth and improvement!

Governance Page

**Changing the language**

- Click the settings icon
- Click the "Language" drop down
- Select your preferred language

Changing the language settings

Understanding the Liqwid Dashboard

1. Supply
- Deposit assets into Liqwid markets 
- Receive qTokens that represent your deposit
- Start earning interest immediately
- Keep earning staking rewards on ADA deposits



1: Connect and Supply

 2. Borrow
- Use your supplied assets as collateral
- Borrow up to 75% of collateral value
- Only pay interest on what you borrow
- No fixed repayment schedule



2: Borrow

3. Repay
- Pay back borrowed assets at any time
- Make full or partial repayments
- Reduces interest costs
- Frees up collateral



3: Repay

4. Withdraw
- Remove your supplied assets anytime
- No lock-up periods
- Includes all earned interest
- Subject to market liquidity


4: Withdraw

Core Actions

Learn the basics: how Liqwid works, navigate the dashboard, and complete your first transactions. Perfect for beginners wanting to understand money markets on Cardano.

These courses teach you how to use Liqwid Finance effectively - from basic operations to advanced yield strategies. 

Liqwid Finance: Getting Started

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