EQ

Equilibrium (EQ) operates a cross-chain decentralized finance platform built as a Polkadot parachain on the Substrate framework. It combines a money market for lending and borrowing, an order book-based decentralized exchange, and its native EQD stablecoin into a single application, with the stated aim of supporting higher leverage through lower collateral requirements and cross-chain asset transfers.

The protocol's design differs from typical collateralized-debt platforms in several ways: users pledge diversified collateral baskets rather than single-asset vaults; borrowing costs are set through a risk-based pricing model rather than pure utilization curves or governance-set rates; and bad debt is handled by third-party insurers who supply liquidity to an insurance pool in advance and assume defaulted debt positions, instead of by liquidation auctions. A real-time risk management system monitors portfolio volatility, insurance pool conditions and system solvency across chains. EQD, the native stablecoin, is asset-backed with a 1:1 USD peg and is defended by overcollateralization, the insurance pool, and a stability fund backed by the Equilibrium treasury; it is transferable to other Polkadot networks via XCM. The platform also offers a "fluid xDOT" product intended to give additional utility to DOT locked for parachain slots. Developer tooling includes a Node.js API package for interacting with the Equilibrium Substrate chain and a Subscan block explorer.

Founding story

Alex Melikhov, an engineer trained in applied mathematics who previously worked on fintech projects, is the founder and CEO. The core team has worked together since 2017, with engineering experience across Ethereum, EOSIO and Substrate before focusing on Polkadot.

Business model

Equilibrium runs a protocol whose usage generates transaction fees on its Substrate chain and product fees, both payable in the EQ token. Liquidity providers lock EQ in bailout/insurance pools to earn yield, and EQ holders can stake tokens to governance for rewards.

Fees are levied on platform operations and products and are paid in the EQ token; insurers and liquidity providers earn fees for securing loans in the system.

Traction

The EQ token has a total supply of 12 billion, with self-reported circulating supply of approximately 3.41 billion. The company stated it expected more than 75% of EQ tokens to be distributed to the public by the end of its first parachain lease on Polkadot.