Summary
This parameter update proposal is aiming to increase the yields earned by lenders who supply assets in Liqwid markets by lowering the reserve parameter in existing markets from 20% to 5%. New SNEK and STRIKE isolated markets launched this week (August 12, 2026) are already set to 5% reserve as outlined in the approved governance proposal. This reserve reduction serves to offer lenders higher yields and accelerate the liquidity bootstrapping phase for these newly deployed pools.
Proposal
Currently the 20% reserve in existing markets is accrued to the DAO Treasury and is used to cover operations and maintenance costs. Reducing the reserve from 20% to 5% across all markets would competitively position Liqwid with the strongest Supply APYs in the entire Cardano DeFi ecosystem. With upcoming product launches and V3 enabling multiple yield strategies to be deployed in size the major bottleneck will be available liquidity across markets. Ensuring lenders can earn the most yield on Liqwid by reducing the reserve amount by 75% is a method to achieve deep liquidity without utilizing inflationary LQ incentives.
If this proposal is successful all existing markets will have their reserve parameter reduced from 20% to 5% to match that of the newly launched STRIKE and SNEK markets.
Conclusion
This proposal seeks to increase lender yields and grow supplied assets by lowering the reserve parameter in existing markets from 20% to 5%. The Liqwid Core Team strongly recommends the adoption of this proposal.