Liquidium offers two primary methods for lending against Runes:
Instant Loans: Lend BTC into automated liquidity vaults, allowing borrowers to instantly take loans against your deposited funds. This method offers efficient capital utilization through partial fills and automated management.
Manual Loans: The traditional peer-to-peer (P2P) method where you create specific loan offers for Rune collections. Borrowers accept your offer, and you must manually countersign to start the loan.
Choose the method that aligns with your preferences for automation, capital efficiency, and control.
Note: Lenders generally do not pay Bitcoin network fees for creating offers or initiating loans. Network fees are typically paid by lenders only when claiming defaulted collateral.
1. Instant Loans for Runes (Lending)
Instant Loans allow lenders to deposit BTC into a personal vault, create lending offers, and have those offers automatically matched with borrowers seeking instant liquidity against their Runes.
Prerequisites:
Compatible Wallet: Ensure you have a compatible wallet connected. Supported wallets include Xverse, Magic Eden Wallet, OKX, Phantom, UniSat, Leather, and Wizz Wallet.
Note on Ledger: Support for Rune loans via Ledger devices may be limited. Please check the Ledger Support article for the latest status.
Sufficient BTC: You need enough confirmed BTC in your wallet to deposit into the vault for lending, plus enough to cover the one-time network fee for the vault deposit transaction.
Steps to Lend Instantly:
Connect Wallet: Connect your preferred wallet to Liquidium. Sign any required messages.
Navigate & Select Instant: Go to the main lending page and select the "Runes" tab. Toggle the switch in the upper-right corner from "Manual" to "Instant" if it’s not on "Instant" already.
Create Vault (One-Time Only):
The first time you use Instant Loans, you'll need to create a personal vault. Find a Rune collection you might lend against and click "Lend" to initiate the vault creation process.
Follow the prompts and sign the transaction in your wallet.
This vault is a secure 1-of-2 multisignature address controlled by you and a smart contract layer, ensuring you always have access to your funds. You can also read Instant Loans: Technical Overview
Crucially, save the Vault Public Key (Pubkey) displayed during creation. You'll need this for emergency recovery.
Deposit BTC into Vault:
Click your profile icon (top-right), then select "Manage" in the Vault section.
Click "Deposit".
Enter the amount of BTC you wish to deposit from your wallet into the vault for lending. Ensure you have enough BTC in your wallet for the deposit amount plus the network transaction fee.
Sign the transaction in your wallet and wait for confirmation.
Your profile will now show both your Wallet Balance and Vault Balance.
Create Loan Offer:
Navigate back to the Lend page for Runes (Instant mode).
Find the Rune project you want to lend against and click "Lend".
Set Loan Parameters: Define the Loan Duration, the total BTC Amount you want to make available in this offer, and the Interest/APY.
Define Risk Ratios (LTV):
Initial Loan-to-Value (LTV): The ratio of the loan amount relative to the collateral's value at the time the loan starts. A lower LTV is generally safer for the lender but will also be accepted less likely by borrowers.
Maximum Loan-to-Value (Max LTV): A safety threshold. If the Rune collateral's price drops after you create the offer, causing the potential LTV of a loan to exceed this Max LTV, your offer will be automatically paused to protect you from unfavorable market conditions. It reactivates if the price recovers.
(Read the example below for more details!)
Review all parameters carefully.
Authorize Offer: Sign the message in your wallet to make your offer live on the platform. Your offer details will appear in your Portfolio page under "Offers".
Loan Fulfillment (Automatic):
Borrowers can now see and accept your offer instantly.
Your offer can be partially filled by multiple borrowers until the total BTC amount is lent out.
No further action is required from you when a borrower accepts; the loan starts automatically.
Repayment/Default:
Repayment: If the borrower repays on time, the principal BTC plus earned interest (minus platform fees) is automatically returned to your vault.
Default: If the borrower fails to repay, the loan defaults. The Rune collateral is automatically sent to your primary wallet address associated with Liquidium. Note: There are no LTV-based liquidations before the loan duration ends.
Walk-through example: how Initial LTV and Max LTV work in practice
Scenario setup
Parameter | Value | Why it matters |
Loan amount you’re offering | 0.7 BTC | What the borrower receives |
Collateral type | 100 Runes | The assets securing the loan |
Current Rune price | 0.01 BTC | Sets the collateral’s value |
Initial LTV you pick | 70 % | 0.7 BTC ÷ (100 × 0.01 BTC = 1 BTC) |
Max LTV (safety cap) | 80 % | Offer auto-pauses above this level |
At the moment you post the offer, 100 Runes are worth 1 BTC, so lending 0.7 BTC equals a 70 % LTV—comfortably inside your 80 % cap.
Price change #1 – small dip, offer keeps running
Rune price drops to 0.009 BTC
Collateral value: 100 × 0.009 BTC = 0.9 BTC
New LTV: 0.7 BTC ÷ 0.9 BTC = 77.8 %
Because 77.8 % < 80 %, your offer stays live and can still be accepted by a borrower.
Price change #2 – bigger dip, offer pauses for safety
Rune price drops further to 0.008 BTC
Collateral value: 100 × 0.008 BTC = 0.8 BTC
New LTV: 0.7 BTC ÷ 0.8 BTC = 87.5 %
Now 87.5 % > 80 %, so Liquidium automatically pauses the offer.
No one can accept it until one of two things happens:
The Rune price rises enough to push LTV back below 80 %, or
You manually edit the offer (e.g., lower the loan amount or raise Max LTV).
Why this matters
Initial LTV sets your starting risk level. Lower values give you a larger buffer before the cap is breached.
Max LTV is the seat-belt. If market moves threaten your buffer, the platform steps in, preventing new loans that would expose you to more downside than you agreed to take.
This step-by-step view shows exactly how price swings translate into LTV changes and when the auto-pause protects you.
Fees for Instant Rune Lending:
Platform Fee: Liquidium collects 20% of the interest earned by the lender. This fee is only applied if the calculated fee amount is 2000 sats or more. If the loan defaults, no platform fee is taken from the lender. Discounts may apply based on your token holdings.
Network Fees: Lenders do not pay Bitcoin network fees for creating offers or when loans are initiated by borrowers. Lenders only pay network fees when initially depositing BTC into the vault or when withdrawing BTC from the vault.
Withdrawing BTC from Vault:
Go to Profile > Manage (Vault section) > Withdraw.
Enter the amount of BTC you wish to withdraw from your available vault balance back to your connected wallet.
Sign the transaction. You will pay the network fee for this withdrawal.
2. Manual (Classic) Loans for Runes (Lending)
Manual (Classic) loans allow you to create specific P2P loan offers for Rune collections. Borrowers can accept your offer, but you must then manually countersign the transaction to activate the loan.
Prerequisites:
Compatible Wallet: Ensure you have a compatible wallet connected. Supported wallets include Xverse, Magic Eden Wallet, OKX, Phantom, UniSat, Leather, and Wizz Wallet.
Note on Ledger: Support for Rune loans via Ledger devices may be limited. Please check the Ledger Support article for the latest status.
Sufficient BTC: You need enough confirmed BTC in your wallet to cover the loan amount you wish to offer.
Creating Manual Offers:
Choose Rune: Navigate to the Lend page ("Manual" toggle selected) and find the Rune project you want to lend against. Click "Lend".
Set Offer Terms:
Enter the BTC Amount you are willing to lend.
Set the Interest Rate / APY you want to earn.
Choose the Loan Duration.
Select the Loan-to-Value (LTV) ratio using the toggle. This determines how much collateral value the borrower must provide relative to your loan amount.
Confirm Offer: Review your terms and click "Submit Offer". Sign the message in your wallet.
Offer Live: Your offer is now listed in the public offer book for that Rune collection and visible in your Portfolio page under "Loan Offers".
Handling Accepted Offers:
Notification: You'll receive a notification (in-app, and optionally via Email/Telegram if configured in settings) when a borrower accepts your offer.
Go to Portfolio: Navigate to your Portfolio page and find the accepted offer under the "Pending" section.
Review & Countersign: Click on the pending loan. You can review the details and optionally check the borrower's profile. If you wish to proceed, click "Sign to Start Loan" (or similar) and sign the transaction in your wallet.
Timeliness: You typically have a limited time (e.g., 12 hours, as per Loan Flow to countersign before the borrower might cancel. Be prompt if you want the loan to proceed. Not countersigning a loan will result in a worse lender rating.
Rebuilds: If UTXOs have changed since the offer was created, you might be prompted to "Rebuild" the transaction first, which then requires the borrower to sign again before you can finally countersign.
Loan Starts: Once you countersign and the transaction confirms on the blockchain, the loan begins. Your BTC is sent to the borrower, and their Rune collateral is locked in escrow.
Canceling a Manual Offer:
You can cancel an offer before a borrower accepts it. Go to your Portfolio page, find the offer under "Loan Offers", and click the cancel ('X') button.
Repayment/Default (Manual Loans):
Repayment: If the borrower repays on time, the principal BTC plus earned interest (minus platform fees) is automatically returned to your wallet.
Default: If the borrower fails to repay by the expiry date, the loan defaults. You will need to manually claim the Rune collateral.
Claiming Collateral on Default (Manual):
Go to Portfolio: Navigate to your Portfolio page and find the defaulted loan under the "Lending" tab.
Click Unlock/Claim: Click the "Unlock" or "Claim Collateral" button.
Select Fee Rate: Choose the network fee rate for the claim transaction (you pay this fee).
Confirm & Sign: Confirm the action and sign the transaction in your wallet.
Receive Collateral: Once the claim transaction confirms, the Rune collateral will be sent to your wallet.
Recommendation for Manual Lending:
Remember that if a borrower defaults, you receive the Rune collateral instead of your BTC back. Only create offers on Rune projects you are comfortable owning at the value implied by your loan amount (Loan Amount / LTV). Assess the risk based on the Rune's volatility and your LTV setting.
Fees for Manual Rune Lending:
Platform Fee: Liquidium collects 20% of the interest earned by the lender upon successful repayment. Discounts may apply based on your token holdings. [Link: Tiered Platform Fee Discounts and Bonuses for Token Holders]
Network Fees: Lenders do not pay network fees for creating offers or starting loans. Lenders do pay network fees when claiming collateral from a defaulted loan.
3. Comparison: Instant vs. Manual Rune Lending
Feature | Instant Rune Lending | Manual Rune Lending |
Speed | Offer live instantly, loans start automatically | Requires manual countersigning by lender |
Process | Automated via Vaults & Matching | Manual Offer Creation & P2P Acceptance/Signing |
Lender Effort | Low (Set up vault/offer, then passive) | Higher (Monitor acceptances, must countersign) |
Capital Efficiency | High (Offers can be partially filled) | Lower (Offer is typically fully accepted or not) |
Risk Management | Automated pausing via Max LTV setting | Relies on lender's initial LTV choice & monitoring |
Platform Fee | 20% of interest (if >2000 sats, waived on default, discounts apply) | 20% of interest (if >2000 sats, waived on default, discounts apply) |
4. Frequently asked questions
Can I change the max LTV for the vault in instant loans?
Yes. You can delete the offer at any time and create a new one. And the team is working on an edit future right now.
What if I lost the public key of the vault?
You can always access your public key in Settings, and it’s important to keep it securely stored in case of an emergency.
To help you prepare for such situations, we’ve developed a dedicated emergency recovery tool.
