> For the complete documentation index, see [llms.txt](https://docs.securd.org/documentation/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.securd.org/documentation/how-does-it-work/indirect-liquidity-providing.md). # Indirect Liquidity Providing {% hint style="info" %} Crypto holders looking to generate simple passive income can deposit crypto assets in their **Securd Savings Account** and become Indirect Liquidity Providers. {% endhint %} These deposits, grouped by asset in **Lending Pools**, are used to grant loans to Liquidity Providers. The loan interest paid by Liquidity Providers (Borrowers) generates revenues in the Depositors' Savings Balance. Like most lending protocols, **Securd** protects deposits from repayment defaults by requiring Borrowers to lock assets in the Collateral Pool. The key difference is that **Securd** uses a very efficient collateral: LP Tokens. These LP Tokens represent the Borrower share of a DEX liquidity pool and can be redeem for a certain quantity of the original tokens. **In order to cover for repayment at any point in time, the ratio between the collateral value and the related loans value, called Collateral Factor or CF, should be maintained above a certain value,** called **Liquidation Threshold** or LT (defined by the Collateral Model and always above 100%). If the Collateral Factor reaches the Liquidation Threshold, **Securd** will seize the Borrower's collateral and sell it to a Liquidator. The sale proceeds will be used to pay back the related loans. This liquidation mechanism offers a strong capital protection to Depositors.