Fluid Magic Element Theory (魔素流体理論 Maso Ryūtai Riron, localized as Liquid Theory of Seithr) is a theorem created by Litchi Faye Ling during her time as an assistant to Kokonoe. Both Relius Clover and Kokonoe have applauded the theory.
Fluid Magic Element Theory is the theory behind solidifying Magic Element and then sealing it, Kokonoe states that the theory could lead to both the creation and control of things relating to Magic Element, such as the Black Beast and the Blue Grimoire; realistically, however, these goals are impossible. In concept, the theory describes the compression of Magic Element to its upmost limit. What's interesting about the theory is that its general concept is eerily similar to that of tempering an Arch-Enemy's core. If the theory fully works, then it is entirely possible to create a human being from Magic Element itself. In order to solidify the Magic Element, an Observer is needed, the more powerful the target then the stronger the Observer.
The theory has often been used a demonstration of Litchi's intelligence, with Relius Clover having Litchi as his assistant purely based on the fact that she established and studied the theory further than anyone else. Both Relius and Litchi began to further explore the theory when she was working with him in the first half of BlazBlue: Chronophantasma. They attempted to strengthen their Observation using machinery and various types of Magic Formula, such as an Overdrive.
Lotte "Roy" Carmine was the first victim of this theory. The theory is said to be the key in saving him, however, since he is a liquid Magic Element.
As of BlazBlue: Chronophantasma, the theory remains incomplete. Currently it's only at the stage of vaporizing the solidified Magic Element. This is done through a special device created by Litchi Faye Ling for Relius Clover. The device was used to turn human bodies into vaporized Magic Element and the Monolith in the 5th Hierarchical City "Ibukido" was utilized as an receptor for it.