PROVIDING LIQUIDITY
Deep liquidity pools for DOLA and INV is of great importance and Inverse Finance endeavors to secure permanent protocol owned liquidity (PoL) by periodically issuing bonds. These bonds act as a form of decentralized OTC where anyone can express their confidence in INV and be rewarded with a discount for exchanging LP tokens and other assets for INV bonds.
Deep DOLA liquidity with both stable and volatile assets allow DOLA to be used as a collateral asset in Frontier which in turn encourages further DOLA borrowing. This enables liquidations to be be absorbed by the market without moving the DOLA price significantly from its 1:1 peg against USD.
Last modified 6mo ago