# How Beraborrow utilises Proof of Liquidity

Deep liquidity is crucial for Beraborrow, as it maximises the platform's offerings by minimising slippage when users engage in looping strategies. We've implemented several mechanisms, such as flywheels that tap into PoL, to deepen the liquidity for `$NECT`. These accumulate voting power, which is then used to direct more rewards to `$NECT` LPs, further incentivising liquidity. This cycle of liquidity deepening and incentivising repeats.

`$NECT`is a composable version of PoL, allowing any LP containing`$NECT`to be auto-compounded while retaining exposure and governance power through `$BGT`. Since `$BGT` emissions can be staked via `$iBGT` to earn additional yield, `$NECT`can be deposited back into the LP, increasing the initial position. This composability uniquely positions Beraborrow to capitalise on PoL, effectively capturing PoL emissions and transforming emissions into more`$NECT`. This creates a sustainable flywheel that frees up capital while maintaining the ability to participate in governance.\
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**Bootstrapping: $NECT/$iBGT flywheel** - auto-compounding with no sell pressure. `$NECT` is essentially a dollar-pegged, wrapped, staked, stable version of `$iBGT`. When `$BGT` is emitted on the `$NECT/iBGT` LP pool, these emissions can be captured through Infrared and deposited back into Beraborow to mint more `$NECT`, then pairing that `$NECT` with `$iBGT` and depositing it back into the LP.

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This mechanism thickens liquidity by continuously increasing the initial position in the `$NECT/iBGT` liquidity pool, without having to sell either asset and earning `$siBGT` emissions on the `$iBGT` in Beraborrow used to mint `$NECT`.