With Fluidity Money, earn rewards for transactions on the blockchain

by Arthur · December 19, 2022

In this current DeFi era, there are a thousand different ways to earn returns, but all of them have the same underlying principle – you usually need to lend, stake or lock your tokens in some form. This is a clear incentive for money to be used as a speculative investment tool, and not as a medium of exchange that affects daily life. To achieve cryptocurrency’s goal of real-world adoption, more people need to start using their tokens in everyday activities.

Now, what if there was a protocol that reversed the existing concept of returns and randomly rewarded users for using their money?

What if every time you made a swap, transfer or purchase, your wallet balance increased?

Enter Fluidity Money. Now, when you exchange or trade your tokens, both you and the recipient have a chance to win potentially life-changing returns.

Let’s dive a little deeper into Fluidity, which recently launched on the mainnet.

Table of Contents

What is Fluidity Money?

Currently, when using a stablecoin like USDC for payment purposes, it’s a zero-sum game. You lose the USDC plus any additional expenses you incur in the form of gas taxes. Fluidity Money wants to change this concept by acting as an incentive layer that rewards utility.

Fluidity allows users to earn as they spend. If holding is not an option, don’t miss out on potential returns!

Mathematically assured, users of liquid assets have the ability to profit from any interaction in the chain.

For an in-depth review, read through our docs!

— Fluidity – (🌊,💸) (@fluiditymoney) March 22, 2022

To achieve this, Fluidity issues wrapped tokens linked 1:1 to their original assets. In other words, if you deposit 100 USDC in Fluidity, you will receive 100 fUSDC. Every transaction with a liquid asset – be it buying NFTs, investing in a DeFi protocol or playing your favorite P2E game – gives you a chance to earn dividends.

And most importantly, the rewards can vary between 1 cent and 1 million dollars!

Some important points to keep in mind:

You can redeem your principal with liquid assets at any time.
Around 50-70% of your transactions will be profitable.
The rewards are split between the sender of the liquid asset (who gets 80% of the reward) and the receiver (who gets 20%).

Here’s how a transaction using Fluidity works.

Say you want to transfer 500 DAI to a friend’s wallet. You can deposit tokens on Fluidity, which will return the wrapped version of the asset—500 fDAI.
Fluidity moves your 500 DAI to a lending platform like Compound, and the returns from Compound are moved to a reward pool and distributed to users via the new Transfer Reward Function (TRF).
As a user, when you perform a chain transaction with fDAI, you put yourself and the recipient of the liquid asset in the competition for dividends.

📣 We just released our second contribution to Fluidity University, about the Transfer Reward feature and how Fluidity rewards you for using crypto. Check it out below! 🌊🏄

— Fluidity – (🌊,💸) (@fluiditymoney) 18 March 2022

The system is very user-friendly. Fluidize your assets, exchange, buy or trade, and voila! You do not need to claim dividends; your wallet receives it automatically. Press a button, wrap, send and earn!

New aspects of fluidity

Since Fluidity randomly rewards you for transactions, an attacker could try to take advantage of the system by creating multiple accounts and sending transactions back and forth. But Fluidity protects against such attacks by using a new optimistic solution that ensures that spammers always pay more in fees than they would potentially receive in payouts. You can read more about it here.
The concept of Liquidity Mining (LM) is fundamentally flawed and relying on mercenary yield farmers is not a sustainable way forward for any protocol. With Utility Mining, genuine users of the protocol can be rewarded with governance token rewards on top of the regular TRF rewards if they exhibit “intended behavior”. Other protocols can sign on to Utility Mining, attracting a high-quality user base incentivized to explore, interact and engage with the platform. The Fluidity DAO will control the governance token emissions, and the DAO will decide which protocols receive more tokens. More info here.

Key investors and roadmap

Fluidity Money has announced a $1.3 million seed round led by Multicoin Capital.

Fluidity launched its beta version on February 12. Around 50,000 users have already traded and exchanged with the beta. “The idea is to start with different DEXs like Uniswap, Saber and Serum,” said co-founder and CEO Shahmeer Chaudhry. “The simple point is that people trade hundreds of millions of cryptos every day. The plan is to move to NFT marketplaces, which have the highest crypto volumes. Every time a user buys or trades NFTs, why not maximize the chances to earn a lot money at no extra cost,” Chaudhry said.

Conclusion

Nowadays, the crypto industry is experiencing hyper growth, with a large number of new innovations taking place almost every day. However, there is not much focus on stimulating

use of tokens or reward engaged users and ensure fair distribution. Fluidity Money is looking to change all that. Now we have an incentive to spend our crypto instead of just storing it.