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What frustrates liquidity providers the most? Putting money into an LP pool essentially locks it up—there are returns, but it's nearly impossible to use these funds flexibly. You have to withdraw to access them, and withdrawing means losing the trading fees. This vicious cycle has now been broken.
A latest innovation from a leading DeFi protocol allows LP tokens to serve dual purposes. Your high-liquidity LP positions like BNB/slisBNB or USDT/USDC can be directly used as collateral to borrow stablecoins (with annual interest rates as low as 0%), which are then transferred into compliant platform financial products—currently, stablecoins can yield over 18% annually. The key is, the original LP tokens continue to sit in the trading pool earning you fees.
Numbers speak for themselves. Suppose you have $1,000 worth of BNB/slisBNB LP tokens. The pool's trading fees can earn you about $7 per month (assuming an annualized rate of 5%-10%). At the same time, using these LPs as collateral to borrow stablecoins for investment yields an additional roughly $15 per month. That’s $22 in income per month, with an annualized return exceeding 26%. What about risks? The platform has built a dedicated LP valuation system and real-time warning mechanisms. Its liquidation logic uses Dutch auctions to ensure fairness. Currently, this system manages assets exceeding $350 million.
In simple terms, it allows your LP funds to work in the pool and generate income simultaneously—double the benefits.