Liquid Learning Path

Asset Types

Understanding the different types of assets on Liquid

Intermediate

Asset Types on Liquid

One of Liquid's most powerful features is its ability to issue and transfer multiple asset types on a single blockchain. Unlike Bitcoin, which primarily handles only BTC, Liquid can handle a diverse ecosystem of assets, each with unique properties and use cases.

Understanding the different types of assets that can exist on Liquid is essential for developers and users looking to leverage the full potential of the platform.

Primary Asset Types

L-BTC (Liquid Bitcoin)

The primary asset on the Liquid Network. L-BTC is a 1:1 Bitcoin peg, meaning each L-BTC is backed by a real bitcoin held in the federation's multisignature addresses. L-BTC serves as the base asset for the network.

Issued Assets

Custom tokens created by Liquid users. These can represent anything from stablecoins to security tokens, utility tokens, or digital collectibles. Each issued asset has a unique asset ID and can be configured with custom properties.

Confidential Assets

All assets on Liquid benefit from confidential transactions, which hide the amount and asset type being transferred. This provides privacy for all types of transactions on the network.

Issued Asset Classifications

Issued assets can be broadly classified into several categories based on their use case:

  1. Stablecoins - Digital assets pegged to fiat currencies or other stable value references. Examples include USDT on Liquid.
  2. Security Tokens - Represent ownership in a company, profit sharing rights, or other financial instruments. These typically need to comply with securities regulations.
  3. Utility Tokens - Provide access to a product or service, often with a specific utility within an ecosystem.
  4. Collectibles - Unique digital items that can be owned and traded, similar to NFTs on other blockchains.

A Note from Satoshi

Unlike many other blockchain platforms, Liquid doesn't have separate standards or templates for different token types (like ERC-20, ERC-721 on Ethereum). Instead, the Liquid protocol provides a flexible framework where issuers can define custom parameters for each asset.

Technical Properties of Assets

When issuing an asset on Liquid, the creator can define several properties:

  • Asset Name - A human-readable name for the asset
  • Ticker Symbol - A short abbreviation, similar to stock symbols
  • Precision - The number of decimal places the asset can be divided into
  • Initial Issuance Amount - How many units to create initially
  • Reissuance Tokens - Whether to allow future issuance of more units
  • Domain - A domain that verifies the issuer's identity

Asset Management

Asset Management→Asset Types
Intermediate
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