The "Deposit-to-Trade" Model
This is Looty's fundamental security mechanism, distinguishing us from every other P2P platform. It replaces "trust" with "economic calculation."
The Key Rule: Limit = Deposit The mechanic is simple: your maximum trading limit (the sum of your orders or active trades) cannot exceed the amount of your security deposit.
Want to trade $500? Deposit $500 USDC.
Want to trade $10,000? Deposit $10,000 USDC.
This deposit is not a fee. It is your collateral, which guarantees your honesty and solvency in the event of a dispute.
How to Make a Deposit The process is fully automated and uses our hybrid architecture (Firebase + Gnosis Safe).
Connect: The user connects their EVM wallet (e.g., MetaMask) to the Looty platform.
Enter Amount: The user specifies the deposit amount (e.g., 1,000 USDC).
Send: The platform provides the user with the address of our Gnosis Safe treasury. The user sends 1,000 USDC (or USDT) from any EVM network (Base, Ethereum, Polygon, etc.) to this address.
Verification: Our backend (Firebase Cloud Functions) automatically monitors the transaction's arrival in real-time. As soon as the transaction is confirmed on the blockchain, the user's deposit balance (
depositAmount) in Firestore is updated. Even if an instant update fails for any reason, the system regularly (every 15 minutes) reconciles all deposits, ensuring your contribution is recorded.Done: Your $1,000 trading limit is activated.
How to Withdraw a Deposit (Unstake) A user can withdraw their deposit at any time, provided that 7 days have passed since their last trade, they have no active trades, and no unresolved disputes.
Request: The user clicks "Withdraw."
Hold: For security and anti-money laundering (AML) purposes, all incoming deposits have a 7-day holding period. You cannot withdraw funds that were deposited less than 7 days ago.
Check: Our system (Cloud Functions) automatically checks if the user has any active disputes and calculates the accumulated trading commission (2%) from all their trades.
Withdrawal: The system automatically initiates a transaction from the Gnosis Safe, subtracting the accumulated commission from the withdrawal amount, and sends the remaining funds (e.g., $980 USDC) back to the user's wallet.
Why It Works This model makes fraud fundamentally unprofitable. Every participant has "skin in the game." A scammer who wants to defraud someone of $200 must first risk their own $200 (or more), which they are guaranteed to lose via slashing after arbitration.
Diagram: Deposit & Unstake Flow
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