How Does Fluid Work?

Shared Liquidity Layer enabling cross-protocol capital reuse

Unified liquidity layer underpins Lending, Vault, and DEX protocols, allowing the same capital to be utilized across all three. Novel capital efficiency primitive.

Smart Collateral earning both lending APR and trading fees

Users supply paired tokens as collateral and earn dual yield from lending interest and DEX trading fees simultaneously. No prior DeFi implementation of this concept.

Smart Debt where borrowed positions generate trading fee revenue

Debt positions are routed through DEX liquidity pools, earning trading fees that offset borrowing costs. Novel mechanism reducing effective borrow rates.

DEX V2 with dynamic fees and asymmetric liquidity pools

Launched November 2025; pools adjust fee structure and liquidity distribution asymmetrically based on market conditions. Novel AMM design.

Buffer zone rebalancing mechanism to reduce permanent loss

December 2025 upgrade introduced buffer zones for rebalancing, reducing permanent loss risks for liquidity providers. Novel loss mitigation approach.

Vault protocol sourcing liquidity from DEX positions

Vault protocol sources liquidity from user positions within the DEX rather than requiring separate LP deposits. Deep integration with Liquidity Layer.

Cross-chain deployment across 5+ blockchains with Ethereum dominance

Deployed on Ethereum (60% of TVL), Plasma (27%), and additional chains. Solana DEX launch planned for Q4 2025 expansion.

Hybrid buyback model using 100% of mainnet revenue

DAO-approved hybrid buyback model since October 2025, directing $1.3-1.5M/month of mainnet revenue to FLUID token repurchases.

Both collateral and debt positions are simultaneously active in DEX trading; during market stress, trading losses on collateral compound with debt obligations, potentially triggering liquidation cascades.

Single liquidity pool serving Lending, Vault, and DEX creates correlated failure risk; a vulnerability in any one protocol could drain liquidity affecting all three.

Absence of supply caps combined with reentrancy-vulnerable Vault functions could allow an attacker to infinitely inflate vault shares during a single transaction.

Heavy inline assembly for gas optimization makes the codebase difficult for auditors to fully analyze, potentially hiding subtle logic errors or edge case vulnerabilities.

Novel rebalancing mechanics in asymmetric pools may behave unpredictably under extreme volatility; insufficient buffer zones could amplify rather than mitigate LP losses.