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BENQI has quickly established itself as a leading lending platform on Avalanche but it also provides AVAX stakers with a way to unlock the value of their staked tokens through liquid staking. Here is how you can utilize both of these features in a few easy steps.
If your wallet doesn’t have Avalanche added as a network you can find a step-by-step guide for that process here. After that you can start by going to the BENQI homepage and selecting the service you want to use.
To use the lending protocol, select the Algorithmic Liquidity Market App and connect your wallet on the next screen.
Once connected the website will redirect you to the main page where you can borrow assets or repay loans.
Before you become eligible for a loan you will first need to supply the protocol with some collateral. To see all available options, go to the Overview tab and select the currency you want to deposit as collateral.
This will give you a general overview of this asset along with total supplied and borrowed amounts. Supply and borrow rates are clearly visible on this page as well and if they seem reasonable, you can continue by clicking on the “Supply & Borrow” button in the top right.
From this page you can both take out loans and repay them by simply selecting the respective options.
Enter the amount you want to supply and don’t forget to tick the “Use as Collateral” button before depositing your funds. This will automatically classify your assets as collateral and once the deposit transaction is confirmed you will be able to borrow assets instantly.
Simply select the “Borrow” tab and specify the amount of tokens you want to borrow. Different assets will have different collateral factors meaning that you will be able to take out a certain percent of your collateral value as a loan.
Both borrowing and repaying your loans can be done on this page.
In case you want to stake AVAX but still keep it liquid you can do so on the liquid staking page. Start by connecting your wallet and specifying how many AVAX tokens you want to stake.
Click on “stake” and confirm the transactions in your wallet. Once they are confirmed by the network you will have the sAVAX tokens in your wallet which can be instantly exchanged for other assets on an exchange or used as collateral on BENQI.
To unstake your tokens simply change the deposit screen to “Unstake” by selecting the option above and specify how many tokens you want to unstake.
BENQI definitely has a lot to offer, especially to AVAX stakers. Not only do they get liquid assets even though the tokens are actually staked but they can also use their staked assets as collateral to take out loans or simply earn more rewards by supplying the asset to the lending protocol.
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