Liquid Finance

Liquid Finance is a non-custodial liquid staking protocol focused on unlocking liquidity within the Archway ecosystem. By participating in Liquid Finance, users can seamlessly balance between securing the Archway blockchain through staking and participating in applications within the broader ecosystem, such as decentralized finance (DeFi)

By using Liquid Finance, users don't need to calculate the typical tradeoff between staking and liquidity as the protocol allows both to occur through its liquid staking token sARCH.

Liquid Finance smart contracts are deployed natively on the Archway blockchain, reducing security assumptions and further aligning the protocol with the Archway community.

Core Features

sARCH Token The sARCH token is a representation of balances staked within the Liquid Finance protocol. sARCH allows holders to earn interest from their staked assets while remaining liquid, allowing for increased capital efficiency of ARCH.

When users deposit their ARCH tokens into Liquid Finance, they can mint sARCH tokens in return. sARCH is an auto-compounding, reward-bearing token, meaning that staking rewards are automatically claimed and restaked by the protocol to compound the holder's yield.

Staking When a user deposits their ARCH tokens into Liquid Finance, the protocol mints and sends sARCH tokens to the user's wallet based on the protocol's exchange rate. The deposited ARCH tokens are staked by the protocol and delegated to a whitelist of Validators to start accruing staking rewards.

Users have two options when they want to redeem their sARCH tokens for their original ARCH deposit plus accrued rewards:

Traditional Unstaking: There is a maximum unstaking period of 25 days before users receive their funds. The period may be shorter since new deposits and claimed rewards within the protocol are first used to match traditional unstaking requests.

Instant Unstaking: Users can instantly swap their sARCH tokens to ARCH for a small 1% fee. This swap is made possible through the Instant Unstaking Queue, which provides liquidity for the instant swaps. Instant Unstaking is dependent on enough liquidity being present in the Instant Unstaking Queue to fulfill the request.

Providing Liquidity Liquidity providers have the opportunity to provide ARCH liquidity to the Instant Unstaking Queue and earn ARCH rewards for doing so. The queue operates on a First-In-First-Out (FIFO) basis, where the first liquidity provider to provide liquidity is the first to have sARCH tokens swapped against it. Liquidity providers receive 50% of the swap fees charged and are incentivized with ARCH while waiting in the queue.

Liquid Finance also offers a passive liquidity management option for liquidity providers want to participate in the queue called "Compound". Liquidity providers first provide their ARCH liquidity with this feature turned on, then once their ARCH is swapped to sARCH it automatically starts the unstaking process. Once claimable it gets provided back to the queue by the protocol without any manual intervention from the liquidity provider.

Advantages

Liquid Finance being deployed natively on the Archway blockchain provides several advantages to users and the ecosystem:

• Ecosystem Composability: Building directly on top of Archway allows for synchronous composability between other Archway applications and Liquid Finance
• Minimized External Dependencies: Liquid Finance leverages the existing infrastructure and security of the Archway blockchain, reducing both the economical and technical dependencies of the protocol
• Flexible Incentives: Liquid Finance's has the flexibility to tailor protocol incentives to initiatives that increase the depth of liquidity and utility of sARCH
• Sustainable Incentives: Combining Liquid Finance protocol incentives and Archway's value capture engine allows for Liquid Finance to increase the amount of rewards that are reinvested back into the ecosystem
• Diversified Validator Delegation: Liquid Finance delegates the ARCH deposited into the protocol across a range of highly-reputable and technically-competent Validators, reducing the slashing risk to a user's staked deposits
• Compounded Staking Rewards: Liquid Finance claims users' staking rewards and automatically re-stakes them within the protocol, compounding user's rewards without and manual intervention needed and saving the transaction fees required to do so
• Archway Community Focused: The Liquid Finance team works closely with Archway ecosystem participants to cater to the specific needs of the Archway ecosystem and ARCH holders

For additional information on Liquid Finance, please visit our public documentation: https://docs.liquidfinance.xyz/