BENQI (QI) is a decentralized finance (DeFi) protocol that offers lending, borrowing, and liquid staking services. It offers two main protocols: BENQI Liquid Staking (BLS) and BENQI Liquidity Market (BLM). BLS tokenizes staked AVAX, enabling users to utilise the yield-bearing asset within DeFi applications. BLM allows users to lend, borrow, and earn interest on their crypto assets.
Users can stake AVAX on BLS to receive a yield-bearing asset called sAVAX. This asset earns yield from Avalanche validator rewards. sAVAX can be freely transferred, traded, or utilized within various DeFi applications, including automated market makers (AMMs), lending and borrowing protocols, and yield aggregators.
The QI token serves as the native governance and utility token, overseeing protocol improvements and changes in the ecosystem. QI holders have governance rights and can propose or vote on BENQI Improvement Proposals (BIPs). Moreover, QI is used to incentivize participation across the platform, including for staking, borrowing, and liquidity provision.