Liquity is a unique player in the Decentralized Finance (DeFi) field, offering interest-free loans in the form of a US dollar-pegged stablecoin, LUSD. Unlike most DeFi lending protocols, Liquity does not impose high interest rates on borrowers. Instead, it requires a high collateralization ratio of 110%, meaning users have to deposit Ethereum (ETH) worth 110% of the LUSD they wish to borrow. Liquity also features a Stability Pool, ensuring the stability of LUSD and reducing liquidation risks.
Furthermore, Liquity’s protocol is designed with immutability in mind, relying on smart contracts for its main functions, thus fostering transparency and eliminating the need for token-based governance. The LQTY token, which captures fees generated by the protocol and incentivizes stability contributions through staking, is also a key component of Liquity.
Liquity was initially launched on Ethereum, but now you can use LUSD on Arbitrum too. Seems like Arbitrum network is getting bigger and better everyday 