# Liquid

**Liquid** (<https://liquid.rain.fi/>) is a protocol that allows users to stake their tokens and receive a liquid staking token (**stToken**) that can be used as collateral to borrow on [Rain.fi](http://rain.fi/).

This lets users keep utility and access liquidity while their tokens remain staked.

#### 🔁 How It Works

* Users stake tokens (e.g. JUP, COLLAT) into **Liquid**.
* In return, they receive an **stToken** (non-transferable, non-convertible).
* **stTokens** can be used as collateral for borrowing, but **cannot** be transferred or sold.

#### 🧷 Unstaking

* The unstaking period depends on the underlying staking program:
  * **stJUP** → **34 days**
  * **stCOLLAT** → **15 days**
* During the unstaking period (e.g. stJUP), users **lose voting power**.
* Once unstaking completes, the user receives back the base token.
  * **1 stToken = 1 base token, always.**

#### ⚠️ Liquidation Behavior

If a user’s **stToken** position is liquidated:

* The stToken is automatically sent to the lender’s wallet.
* It remains considered **staked** (with **full voting power restored for stJUP).**
* The lender can then choose to unstake if they wish.

#### 🔒 Restrictions

* Users **cannot create pools** using **stTokens**.
* **stTokens are non-transferable** and **cannot be swapped** into any other token.

#### 🎁 Rewards Distribution

* Users must **claim rewards directly** on Liquid after each distribution.
* Rewards are distributed in the form of **stTokens**, which directly increase the staked balance of each user.


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