Buying Locked Liquidity

Buying locked liquidity is a new form of DeFi investing facilitated by the Drops marketplace. It entails the purchase of a liquidity lock ownership, typically at a reduced price compared to the ETH value of the locked pool. The intention is to wait for the unlock date of said pool to claim profits.

When locked liquidity is purchased, the DROPS (or ETH) used to buy pool ownership is transferred to the seller, and lock ownership is transferred from the marketplace’s main smart contract to the buyer.

Use-case example:

Jane plans on holding Ethereum for a long time, and is looking for low-risk ways to accumulate more of it. She decides to begin accumulating more ETH by buying locked liquidity through the Drops Marketplace, a fully secure and decentralized platform. Jane browses the different listings, and finds a pool with 5 Ethereum and a 6 month lock being sold for 100 DROPS (100 DROPS = 4eth in this example).

She buys 100 DROPS for 4 Ethereum, purchases the pool, waits 6 months, and withdraws the liquidity. Jane has just made 1 Ethereum in profit as a result of her patience.