Dec 16, 2021 · 2 min read · cat
The transition from Traditional Finance (TradFi) to the decentralised world of cryptocurrencies can be daunting for investors of all backgrounds. With the rising popularity of Decentralized Finance (DeFi), more and more people are looking to enter the space. But the complexity and ambiguity of DeFi protocols often scare potential investors off. That’s where Linear Finance steps in, to bridge the gap by keeping feet in both doors through the use of ‘Liquids’ — a concept similar to financial derivatives!
WHAT ARE LIQUIDS?
In short, Liquids are Linear’s synthetic assets. They provide users with one-to-one exposure to real world assets, without needing to purchase the actual underlying asset. Liquids offer investors access to financial products commonly found in traditional investing, including indices, commodities and much more. Linear Finance provides a low-cost, easy-to-use exchange for an investor to invest in multiple asset classes on a single platform.
TRADING WITH LIQUIDS
Purchasing Liquids on Linear requires some preliminary steps. Firstly, to acquire Liquids on our platform you will need to be holders of our protocol stable coin, ℓUSD. There are two main methods to get your hands on ℓUSD — buying it on exchanges or staking $LINA to mint it. Luckily, we recently published guides on both so click on the hyperlinks to learn how to!
From there, traders can use ℓUSD to purchase Liquids. Specifically, this can be done through the Linear Exchange which allows you to trade liquids via ℓUSD to gain exposure to a variety of digital assets. Trades are instantaneous, have virtually no slippage, and come with a 0.25% fee. Although all the synthetic assets are added by the Linear team at the moment, it will be possible in the future to add new liquids via Listing Proposals once the LinearDAO is live. Liquids are currently tradable on the Ethereum and Binance Smart Chain network, with a planned expansion into Polkadot in 2022 via its partner, Moonbeam.
Synthetic assets will undoubtedly play a large role in the future of crypto finance, and hopefully this article has provided a clearer insight into how they work. We look forward to seeing more non-crypto investors using Linear Finance as a stepping stone into the revolutionary world of DeFi!
About Linear Finance
Linear Finance is a cross-chain compatible, decentralized delta-one asset protocol that allows users to get synthetic exposure to various assets, including cryptocurrency, commodities, and market indices. Users can utilize our cross-chain swap functionality to instantly swap assets across leading blockchain environments and DeFi protocols with unlimited liquidity and zero slippage.