> For the complete documentation index, see [llms.txt](https://liquidestate.gitbook.io/docs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://liquidestate.gitbook.io/docs/documentation/architecture.md).

# Architecture

### Legally Sound. Technically Scalable. Economically Fluid.

Liquid Estate is built on a robust architecture that combines **legal enforceability**, **blockchain-native infrastructure**, and **a unified liquidity layer**. Our system design makes high-yield real estate accessible, tradable, and programmable – without compromising on legal security or asset backing.

***

### Real Estate Ownership Structure

Each property is held by a GmbH – which:

* Is the sole registered owner in the land register
* Legally acts **on behalf of all token holders**
* Is responsible for acquisition, management, and execution

Unlike traditional tokenization or virtual equity schemes, token holders in Liquid Estate do not receive shares or land registry entries. Instead, they receive **legally binding claims** to:

* **Rental income**
* **Appreciation**
* **Sale proceeds**

  (After deducting applicable fees, financing costs, and operational expenses.)

***

### Property Tokenization (ERC20 + ERC4626)

Each property (or property pool) issues its own **ERC20 token** to represent fractional participation in that asset. These tokens are:

* Fully tradeable
* Tied to a real-world legal structure
* Non-governance, pure yield-bearing instruments

Every token is integrated with an **ERC4626 vault**, enabling:

* **Automated, proportionate yield distribution**
* **Composability with DeFi protocols**
* **Transparency on income flows**

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### The Liquid Estate Liquidity Layer

All Liquid Estate tokens are powered by **$leLIQD** – the core token of the platform and the economic engine of liquidity.

Here’s how it works:

* There is **one central liquidity pool**, pairing **$leLIQD** with USDT0.
* Every property token (e.g. $PROP01, $PROP02) is paired directly with **$leLIQD**.
* This forms a **hub-and-spoke model**, allowing all property tokens to indirectly access deep USDT0 liquidity **through $leLIQD**.
* Property token trades route through **$leLIQD**, providing:
  * **Price discovery**
  * **Instant liquidity**
  * **Unified on-chain settlement**

In short: **one liquidity to rule them all**.