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- Liqwid is built on Cardano and enables borrowing and lending with native tokens.
- The funds of the project Catalyst will exceed millions of dollars worth of ADA in 2021.
The Cardano ecosystem is going through an exciting stage in its development. On the one hand, IOHK is working on its capabilities as a platform for building decentralized finance protocol. In addition, the community is getting more decision power. Project Catalyst has combined these two premises by introducing the Liqwid protocol.
Via its Twitter handler, Cardano’s development company, IOHK published a “Mega Thread” on Catalyst. That way, the Cardano community received the newest information on the progress of project Catalyst. One of the first DeFi projects to be presented is Liqwid, a decentralized, non-custodial lending solution.
Liqwid is built on the Cardano blockchain and operates as a market maker with liquidity funds based on the platform’s native tokens which will be launched with Goguen. Users can lend or borrow by connecting to the protocol and can earn or pay variable interest rates without the need for a third party, such as a bank.
Every money market is linked to a Cardano-native asset (such as ADA, future “CDN-20” wrapped ERC-20 coins such as CDN-20-NGNT, or any other Cardano-native governance/NFT/stable/utility token), and contains an open-source and publicly-verifiable ledger, with an archive of all transactions and interest rates since market formation.
Among the many use cases that can be applied with Liqwid, investors can have a tool to maximize passive return strategies using Cardano based tokens. The protocol has been designed to operate with little active token management, as IOHK explained:
The Liqwid model has the potential to massively disrupt the web2 CeFi paradigm operating model that places the key value producers (borrowers/lenders) at the bottom of the value chain beneath third party (economically destructive) value extractors (e.g.central banks, bank KYC/AML compliance unit overhead (…)
The Cardano community will vote to award $250,000
Liqwid was only one of the projects presented by IOHK in their “Festival of Ideas”. The company strives to keep the community informed about the candidates who will be eligible to vote for $250,000 in ADA as part of project Catalyst. The funds are granted by Fund2 as part of an “early experiment” in the deployment of the governance model that will be part of the Voltaire era.
IOHK also reported that by 2021, the funds to be delivered as part of Catalyst will exceed millions of dollars worth of ADA. Therefore, they have invited the community to participate in the initiative. So far, project Catalyst appears to be well attended, as IOHK stated:
We’re already seeing huge energy, great creativity & awesome community collaboration across a host of ideas. We want to celebrate that. So starting today and running through the festive season, that’s what we’re doing.
