General
What is Base Dollar?
Base Dollar is a decentralized borrowing protocol that lets users deposit WETH, wstETH, rETH, cbBTC, cbETH, AERO, and Aerodrome LP tokens as collateral, and mint the stablecoin BaseD at an interest rate depositors choose. Base Dollar is a Liquity V2 fork built specifically for Base with innovative LP token collateral and AERO farming revenue.
The main use-cases for Base Dollar are:
- Borrow BD
- Earn yield by depositing BD in the stability pools
- Leverage Aerodrome LP positions while earning AERO rewards
To understand Base Dollar, it's helpful to understand Liquity.
Liquity V1 was a lending protocol that allowed users to take 0% interest loans on their ETH to receive $LUSD. Over the past 4 years it proved itself resilient in a variety of market conditions.
Liquity V2 is the next iteration of borrowing, allowing users to set their own interest rate, and use more tokens as collateral.
Liquity V1 vs Liquity V2
| Similarities | Differences |
|---|---|
| Decentralized | User-set interest rates – more control over your borrowing cost. |
| Rigorous Security | Improved redemption mechanism (lowest borrowing rate is redeemed first) |
| Redemption of stablecoins for underlying collateral maintains the $1.00 peg no matter what | Troves are now transferable |
| ETH Mainnet Only | V1’s code was free and open-sourced (FOSS), while with V2, Liquity will have its code set as a business source license (BUSL) |
Base Dollar vs Liquity V2
| Key Differences | Description |
|---|---|
| Blockchain | Base (Ethereum L2) vs Ethereum Mainnet |
| Collateral Types | WETH, wstETH, rETH, cbBTC, cbETH, AERO, and Aerodrome LP tokens. Additional collateral types can be added in the future. |
| LP Token Innovation | Routes configured Aerodrome LP collateral through AeroManager for gauge staking and AERO rewards. |
| AERO Integration | AeroManager charges a 10% default claim fee, capped at 20%, and sends it to the treasury. |
| Branch Redeemability | Each branch is registered as redeemable or non-redeemable; LP collateral is not automatically protected. |
| Revenue Distribution | 75% to the branch Stability Pool and 25% to the configured interest router. |
Does Base Dollar have governance?
Base Dollar currently uses governor roles rather than a deployed governance token. Planned governance scope includes:
- Distributing Protocol Owned Liquidity (POL)
- Directing protocol revenue and AERO rewards
- Managing fees, LTV requirements, and minimum debt thresholds
- Updating collateral debt limits
- Adding or removing collateral branches via the Collateral Registry
- Voting on veAERO allocation strategy
A BASED governance-token and staking system is not deployed by the active deployment path.
Other Helpful Resources:
Base Dollar App: https://app.basedollar.org/
Base Dollar Website: https://basedollar.org/
Base Dollar Github: https://github.com/basedollar
Base Block Explorer: https://basescan.org/
Aerodrome Finance: https://aerodrome.finance/
Liquity V2 Documentation: https://docs.liquity.org/
Community:
- Discord: https://discord.gg/5h3avBYxcn
- X/Twitter: https://x.com/BaseDollarOrg