Cardano
Lending

Lender Liquidity Pools (FluidTokens V3)

Lender Liquidity Pools enable flexible Cardano DeFi lending, where lenders provide ADA or stablecoins to fund loans and select specific native tokens as accepted collateral. Unlike P2P loan requests, where borrowers set terms, lenders control the parameters, allowing borrowers with matching tokens to access funds instantly, initiating standard P2P loans.

Overview

Anyone with a Cardano wallet can create a liquidity pool by depositing ADA or stablecoins and selecting particular native tokens (e.g., FLDT, USDM, or SNEK) as collateral. Borrowers with those tokens can instantly borrow a portion or the entire deposit in a particular pool, following P2P lending mechanics. Secured by FluidTokens’ non-custodial Cardano smart contracts, lenders retain full control, allowing them to withdraw or adjust the available liquidity at any time.

Creating a Pool

The lender can create a liquidity pool by depositing ADA or stablecoins with custom loan parameters:

  • Liquidity Amount: How much ADA or stablecoins to offer.

  • Accepted Collateral: Specific tokens (e.g., stablecoins or other Cardano native tokens).

  • Loan Terms: Maximum loan amount, APR, and duration (days, weeks, or perpetual).

Active loans can be tracked from the DASHBOARD tab.

Note: You must hold the NFT bond representing each lender position. 

How to Lend

1. To become a lender, click on SUPPLY or CREATE LOAN. Alt text

2. You’ll see the DEPOSIT window. Alt text

3. Type in the desired amount of ADA you wish to lend. Alt text

4. Select the markets you want to lend your ADA to. Alt text

5. Click on CONTINUE when you’re ready. Alt text

6. Choose the Maturity Period of your deposit. Alt text

7. Double-check your deposit terms. Alt text

8. Click on DEPOSIT when you’re ready. Alt text

9. Click on CLOSE after you successfully sign the transaction. Alt text

10. You can navigate to your loans and deposits from the top banner. Alt text

11. Click on DASHBOARD to check your positions. Alt text

12. You can see your pools with deposited ADA under Pools. Alt text

13. You can adjust your deposit parameters via the Modify Pool feature. Alt text

14. Click on Lends to check all active loans you’ve supplied. Alt text

Tip: Your pool is listed and aggregated with others based on the type of collateral. In this regard, accepting multiple tokens as collateral will increase your chances of finding borrowers.

Borrowing

Borrowers can instantly borrow from pools that accept matching collateral types and loan terms. Loans follow the P2P lending process: borrowers lock tokens as collateral, receive funds, and repay the loan with interest by the specified deadline.

Perpetual Loans

Perpetual loans unlock access to P2P loans without expiration. However, they require a fixed monthly fee to stay active. Missing a payment leads to default. Alt text

How to Borrow

1. Go to dev.fluidtokens.com/ada/markets. Alt text

2. Connect your wallet using the CONNECT WALLET button. Alt text

3. Click on CREATE LOAN. Alt text

4. Type in the amount you want to borrow. Alt text

5. Type in the amount you want to deposit as collateral. Alt text

6. Set the loan maturity. Alt text

7. Double-check before finalizing the transaction. Alt text

8. Click on BORROW when you’re ready. Alt text

9. Click on CLOSE after you finalize the transaction. Alt text

10. You can keep track of your loans from the Borrows tab. Alt text

11. Click LOAN ACTIONS to make payments, manage collateral, or repay your loan. Alt text

Tip: You can transfer and/or sell your loan by transacting the NFT bond representing it.

Pool Management

Lenders can withdraw unused liquidity or add more at any time via the dashboard.

How to Withdraw from a Pool

1. Go to https://dev.fluidtokens.com/ada/markets Alt text

2. Connect your wallet by clicking on CONNECT WALLET in the top right corner Alt text

3. Navigate to DASHBOARD in the top left corner Alt text

4. Click on POOL ACTIONS under the desired pool Alt text

5. Click on Withdraw and type in the amount you wish to withdraw Alt text

6. Click on WITHDRAW and sign the transaction Alt text

7. You’ve successfully withdrawn your deposit! Alt text

Important Note: You cannot withdraw liquidity that has already been borrowed. To withdraw your entire deposit, you must wait for tall borrowers to repay their loans.

How to Modify Pool Parameters

1. Go to https://dev.fluidtokens.com/ada/markets. Alt text

2. Connect your wallet. Alt text

3. Navigate to DASHBOARD in the top left corner. Alt text

4. Click on POOL ACTIONS under the pool you want to modify. Alt text

5. Click on Modify Pool.

Alt text

6. Type in the desired amount in the You lend tab. Alt text

7. Select the markets you wish to supply. Alt text

8. Click on CONTINUE when you’re ready. Alt text

9. Select the desired maturity period of your deposit. Alt text

10. Set the desired interest rate

Alt text

Tip: You can choose from one of the recommended rates.

11. Click on MODIFY when you’re ready to supply. Alt text

12. Click on CLOSE and enjoy the yields from your DeFi loan! Alt text

Use Cases

  1. Stablecoin Lending: Offer liquidity for stablecoin collateral (e.g., USDM) to support low-volatility lending.

  2. Passive Income: Earn interest (APR) from borrowers while maintaining control over your funds.

  3. Ecosystem Support: Provide liquidity for Cardano native tokens, boosting projects in the community’s verified token list.

Liquidations

Loan liquidations are the primary tool for risk management on the FluidTokens V3 app. The lender can manually trigger liquidations in two cases:

  • When the Loan-to-Value (LTV) reaches 80%* or higher;

  • If the borrower defaults/doesn’t repay their loan on time;

The liquidation penalty is set at 10%. The lender receives a 5% fee from the collateral, and the platform retains the other 5%. This incentivizes active management while supporting platform sustainability. 

Note: The lender must have the specified NFT bond, while the borrower must have the underlying NFT bond to claim the remainder from the liquidation. Delays in triggering liquidation may result in losses if the collateral value continues to decline.

*Check the Risk Parameters section for more information on LTVs

Risk Parameters

As with any DeFi protocol, there is a generic risk of smart contract bugs and exploits. In this regard, FluidTokens has taken all the necessary precautions by utilizing non-custodial smart contracts, audited by Vacuum Labs. 

LTV and Liquidation Thresholds for High-Liquidity Assets

Initial markets focus on liquid assets with standardized LTV and liquidation thresholds. Future assets will have variable thresholds based on liquidity depth.
Asset Minimum LTV Liquidation Threshold
FLDT 66% 80%
USDM 66% 80%
USDA 66% 80%
SNEK 66% 80%
WMTx 66% 80%

Note: New assets added in the future will have LTV and liquidation thresholds tailored to their liquidity depth, balancing risk and opportunity.

For detailed risk information, refer to the DeFi Risks and Security section on the FluidTokens website.

Aquarium