Interest-free liquidity at your fingertips
Borrow LUSD against ETH interest-free.
Low collateralization ratio
The highly efficient liquidation mechanism of the Liquity Protocol enables you to get the most liquidity for your ETH. Take advantage of interest-free loans to achieve your goals.
Learn how it works
Robust and stable
The protocol’s algorithmic governance and the direct redeemability of LUSD ensures that the stablecoin remains pegged to the US Dollar.
Holders of LUSD can provide stability to the system, while benefitting
from liquidation gains and LQTY rewards.
Become a Frontend Operator
Download the launch kit and run a frontend. By providing access to the protocol you receive a part of your users' rewards.
Learn how to run a frontend
FAQ
What is Liquity?
Liquity is a decentralized borrowing protocol that allows you to draw 0% interest loans against Ether used as collateral. Loans are paid out in LUSD - a USD pegged stablecoin, and need to maintain a minimum collateral ratio of only 110%.
In addition to the collateral, the loans are secured by a Stability Pool containing LUSD and by fellow borrowers collectively acting as guarantors of last resort. Learn more about these mechanisms under Liquidations.
Liquity as a protocol is non-custodial, immutable and governance-free.
What are the key benefits of Liquity?
Liquity offers the best borrowing conditions on the market with the main benefits being:
- 0% interest rate
- A collaterization ratio of just 110%
- Governance free - all operations are algorithmic and fully automated
- Directly redeemable - LUSD can be redeemed at face value for the underlying collateral, always and at any time
- Censorship resistant - the protocol is controlled by nobody
How can I earn money on Liquity?
There are basically two different ways to generate revenue using Liquity:
1. Deposit LUSD to the Stability Pool and earn liquidation gains and LQTY rewards
2. Stake LQTY and earn the revenue from issuance fees (in LUSD) and redemption fees (in ETH)
Why should I become a Frontend Operator?
Frontend Operators provide a web interface to the end-user enabling them to interact with the Liquity protocol. For that service, they will be rewarded with a share of the LQTY tokens their users generate.
LQTY rewards are being awarded to Stability Pool depositors and then proportionally shared between the users themselves and the Frontend Operator. How much each party gets is determined by the kickback rate which is set by the Frontend Operator and can range between 0% and 100%.
Setting a high Kickback Rate will make the Frontend Operator attractive to users, but offering a nice interface and additional functionalities might allow for a lower kickback rate while still garnering user interest.
