BOLD is the dollar-pegged stablecoin issued by Liquity V2, minted by borrowers against ETH, wstETH, or rETH collateral, and backed by nothing else. It carries an A- rating from the stablecoin rating agency Bluechip, placing it above several far larger centralized dollars, and it pays holders a yield sourced entirely from the interest borrowers choose to pay. The token launched with Liquity V2 in January 2025 and was redeployed in May 2025 after the original contracts were retired.
What separates BOLD from most decentralized dollars is that no committee sets its terms. There is no governance vote on collateral types, no risk council adjusting the debt ceiling, and no admin key capable of pausing it. The parameters were fixed at deployment and will hold for as long as Ethereum runs.
How BOLD Enters and Leaves Circulation
Every BOLD in existence was minted by someone who locked up over a dollar of ETH to get it. The process runs through a Trove, Liquity's term for a collateralized position:
- Deposit WETH, wstETH, or rETH into a borrow market and open a Trove with at least 2,000 BOLD of debt.
- Choose an interest rate. The borrower sets this number, and it accrues continuously in BOLD on top of the debt.
- Pay an upfront fee equal to seven days of average interest on that collateral branch.
- Receive BOLD, freely transferable and usable anywhere on Ethereum.
- Repay at any time to unlock the collateral. There is no repayment schedule and no maturity date.
BOLD leaves circulation two ways. Borrowers repay debt and burn it, or anyone holding BOLD redeems it directly with the protocol for collateral at face value. Redemptions are the peg mechanism. When BOLD trades below $1, buying it cheaply and redeeming it for a dollar of ETH is profitable, and that arbitrage removes supply until the price recovers. The protocol services those redemptions starting from the Troves paying the lowest interest rates, and it routes them toward the collateral branches with the weakest Stability Pool coverage, which strengthens the overall backing as the supply shrinks.
Where the Yield Comes From
BOLD's yield is not an incentive program and there is no token being emitted to fund it. It is interest, paid by borrowers, in the same asset. Every Trove accrues a rate its owner selected, and that revenue splits on a hard-coded ratio: 75% to Stability Pool depositors, 25% to the Protocol Incentivized Liquidity budget that LQTY stakers direct.
Depositing BOLD into a branch's Stability Pool therefore earns a floating yield tied to what borrowers on that branch are willing to pay, plus liquidation gains in the underlying collateral when a Trove gets wound down. The trade-off is exposure: a Stability Pool depositor is effectively buying collateral at a discount during liquidations, so a sharp drawdown converts stablecoins into ETH at the worst moment for anyone who wanted to stay in dollars.
The 25% that does not reach depositors flows to whichever liquidity venues LQTY voters favour that week, and LQTY's fixed supply and fee structure determine who gets to make that call. That is the connection between the stablecoin and the governance token: BOLD adoption is what gives the LQTY vote anything to allocate.
What Actually Backs BOLD
Three assets, and only three. WETH, Lido's wstETH, and Rocket Pool's rETH, each in its own borrow market with its own maximum loan-to-value ratio, its own Stability Pool, and its own shutdown threshold. There are no treasury bills, no centralized issuer, and no off-chain reserve to audit.
That narrow collateral base is the reason Bluechip rates BOLD at A-, placing it above widely held options such as USDC and DAI in its assessment. The agency weights immutability and redeemability heavily, and BOLD scores well on both: it can always be exchanged for the underlying at face value, and no party can prevent that exchange. Compared with centralized dollars, where USDC and USDT differ mainly in issuer structure and attestation practice, BOLD's risk is entirely on-chain.
The flip side is concentration. BOLD is a leveraged claim on ETH and two staking derivatives. If a liquid staking token depegs badly enough that liquidations fail on its branch, BOLD holders across every branch carry the consequence, because the stablecoin's backing pools all of them. Peers such as crvUSD and GHO diversify collateral more aggressively and accept governance overhead as the price of that flexibility.
Fork Rewards, the Other Reason to Hold BOLD
Liquity V2 ships under a business license, and more than twenty teams have signed it to launch their own stablecoin on their own chain. Each of those forks has committed roughly 4% of its token supply to BOLD users, with about 2.75% going to holders using BOLD across DeFi and the remainder to BOLD paired liquidity pools on the fork's own venue.
Liquity's own estimate puts the total between $20 million and $70 million depending on where the fork tokens price. For a stablecoin whose supply is measured in tens of millions, that is a substantial return stacked on top of the native yield, and it explains why BOLD circulation has held up better than the protocol's fee revenue would suggest on its own.
Frequently Asked Questions
Is BOLD a safe stablecoin?
BOLD is overcollateralized by ETH and staked ETH, immutable, and always redeemable for its backing at face value, which earns it an A- rating from Bluechip. The risks are smart contract failure, a collapse in one of its three collateral assets, and liquidation failure during extreme volatility. A Stability Pool flaw found in February 2025 forced a full redeployment of V2, which shows both the seriousness of the audit process and the cost of immutability when something goes wrong.
How do you earn yield on BOLD?
Depositing BOLD into a Liquity V2 Stability Pool earns 75% of the interest borrowers on that branch pay, plus a share of liquidated collateral. BOLD can also be supplied to external liquidity pools that receive Protocol Incentivized Liquidity from LQTY voters, and holding or deploying BOLD accrues points toward airdrops from the licensed fork ecosystem.
What is the difference between BOLD and LUSD?
LUSD is the stablecoin of Liquity V1, backed by ETH only, borrowed at 0% recurring interest with a one-off fee. BOLD is the Liquity V2 stablecoin, backed by ETH plus two liquid staking tokens, borrowed at a rate the borrower sets and pays continuously. LUSD pays holders nothing directly, while BOLD carries native yield from borrower interest.
BOLD's Place Among Decentralized Dollars
BOLD is a small stablecoin with an unusually clean design argument. It pays real yield without subsidy, it redeems for hard collateral on demand, and nobody can change how it works. Those properties matter most in exactly the conditions where centralized dollars are least comfortable to hold, which is a narrow but durable market.
Whether that translates into scale is the open question, and it is the same question that governs LQTY's price outlook, since the token's revenue depends on how much BOLD gets borrowed into existence. The fork ecosystem is the most credible growth lever currently in play.
Ready to take a position on the protocol behind BOLD? Trade LQTY on spot or open a leveraged LQTY futures position on LeveX, and find more stablecoin explainers in Crypto in a Minute.