Linear Finance, also known as "Linear," is a cutting-edge financial protocol designed to enable non-custodial transactions and facilitate the exchange of delta-one assets across different blockchain networks. Its overarching goal in the decentralized finance (DeFi) space is to enhance inclusivity and democratize users' access to a wide range of investable assets, both digital and traditional.
Linear Finance was established by co-founders Drey Ng and Kevin Tai. According to the official Linear Finance LinkedIn page, the company operates with a relatively small team consisting of fewer than twelve individuals.
Drey Ng, one of the co-founders, serves as the current chief product officer of Liquefy, a platform dedicated to providing access to tokenized securities by reducing entry barriers. Additionally, he is a blockchain instructor based in Hong Kong, bringing his expertise and knowledge to educate others in the field. Drey Ng boasts extensive experience in the fintech industry, contributing to his understanding of the evolving landscape.
Kevin Tai, the other co-founder, previously held the position of vice president at Credit Suisse in Hong Kong, a renowned global wealth management and investment banking firm. He completed his education at Harvard Business School, equipping him with a solid foundation in business and finance. With over a decade of experience in the economic sector, Kevin Tai brings valuable insights and expertise to the development of Linear Finance.
A key aspect of Linear's vision is to provide users with the ability to conveniently and swiftly buy and sell assets at fair market prices, all while reducing transaction fees. Leveraging a combination of extensive technical expertise derived from various cryptocurrency projects and deep financial experience in exotic and structured assets gained from traditional global asset management firms, Linear has positioned itself as one of the pioneering DeFi initiatives built on the Ethereum blockchain with cross-chain compatibility.
By utilizing the comprehensive tools offered by Linear, users can construct and manage their own spot or portfolio exposures through an array of innovative digital and traditional derivative products. Initially, Linear focuses on supporting synthetic assets built on other Ethereum Virtual Machine (EVM) compatible chains, with plans to expand its compatibility to other prominent blockchains in the future. This approach simplifies and expedites the staking, acquisition, and redemption processes, while significantly reducing transaction fees. Importantly, Linear ensures continued access to the Ethereum DeFi ecosystem throughout this process.
At the core of Linear's protocol lies its collateralized debt pool, which allows for the utilization of various digital and real-world assets as collateral. This includes the native Linear token (LINA). Users who contribute collateralized assets to the debt pool gain the ability to create Linear USD (LUSD), a stablecoin that can be used to acquire synthetic assets known as Liquids through the platform's native exchange.
The collateralized assets provided by users are pooled together to ensure immediate liquidity and act as counterparties within the system. Additionally, the LINA token serves as a governance token, granting holders the power to vote on matters such as distribution models, asset listings, oracle selection, pledge ratios, and more.
Active participants who contribute collateral to the debt pool will be rewarded for their involvement with the platform. They will receive a proportional share of the fees generated from the minting of Liquids, further incentivizing engagement and participation.
The protocol encompasses a range of products, including Linear.Buildr, a decentralized application (DApp) designed for managing Liquids by utilizing Linear (LINA) and other tokens as collateral. This DApp facilitates the creation and management of Liquids within the ecosystem.
Furthermore, the protocol features an exchange that is purpose-built to enable seamless trading of diverse Liquids. This exchange is characterized by its ability to provide swift confirmation times for transactions and maintain robust security measures. It ensures a reliable and efficient platform for trading various Liquids within the ecosystem.
The native token of Linear, called LINA, is a digital asset that serves multiple purposes within the Linear protocol. It is designed to be secure and transferable, utilizing cryptographic technology to ensure its integrity. LINA has two main functions: governance and utility. LUNA has a total supply of 10 billion tokens and as of June 2023, the circulating supply is 5,454,162,506 LINA.
As a governance token, LINA allows holders to participate in decision-making processes within the Linear protocol. This includes voting on important matters such as protocol upgrades, changes to distribution models, and other governance-related decisions. It gives token holders a say in shaping the future of the protocol.
Additionally, LINA serves as a utility token within the Linear ecosystem. It has specific functions and use cases specified in the protocol's code. These utility functions enable users to interact with various features and services offered by Linear. LINA is designed to seamlessly integrate and be compatible with other components of the protocol, enhancing its interoperability.
LINA tokens can be utilized as the primary collateral to create Liquids through a decentralized application called "Buildr." Buildr serves as a platform for managing collateral pools and Liquids within the system.
When minting Liquids, a pledge ratio is required, which means that the collateral provided must be over 100% of the value of the Liquids being minted. This over-pledging requirement is in place to safeguard the stability of the entire system by mitigating the potential impact of volatility in the pledged assets. It ensures that the value of the collateral remains sufficient even during market fluctuations.
Over time, the pledge ratio can be gradually optimized. The specific adjustments to the pledge ratio will be determined through community-driven governance facilitated by the LinearDAO. The LinearDAO allows the community of LINA token holders to actively participate in decision-making processes and collectively shape the parameters and rules of the protocol.
By maintaining an appropriate pledge ratio and involving the community in its optimization, Linear aims to create a robust and sustainable ecosystem for minting Liquids and ensuring the overall stability of the system.
Average Fees on Linear Finance
To encourage user participation and incentivize liquidity provision, the initial transaction fee is established at 0.25%. Users who contribute liquidity or collateral will have the opportunity to receive rewards in the form of LUSD on a weekly basis. These rewards will be distributed proportionally, based on each user's Pledge Ratio (P ratio), as long as it exceeds the predetermined threshold.
LINA Token Wallets
The LINA token can be held in many popular crypto wallets, including Atomic Wallet, Trust Wallet, MetaMask, Ledger, imToken, Torus, Coinbase, TokenPocket, iToken Wallet, Assure Wallet, OKX, Portis, Freewallet, etc.
