What Liquity USD is
Liquity USD (LUSD) is a crypto-collateralized / algorithmic stablecoin, currently ranked 302nd by market capitalization among the assets we track. Liquity USD aims to hold a stable value without relying on a centralized reserve. It leans on over-collateralization, automated incentives, or both, which is powerful but historically more fragile than cash backing.
Liquity USD (LUSD) is a decentralized stablecoin that is collateralized by Ethereum, designed to provide interest-free loans against Ethereum collateral. It aims to maintain a stable value while enabling capital efficiency within the DeFi ecosystem.
How the peg is engineered
Because backing is on-chain, Liquity USD can be audited in real time — but it also inherits the volatility of its collateral. Liquidation mechanics and over-collateralization buffers are what stand between the peg and a depeg.
Background & fundamentals
Its codebase is open-source, meaning the implementation can be audited rather than taken on trust. In sector terms it is most often filed under Ethereum (ETH) Token (ERC-20), Polygon (MATIC) Token, and Arbitrum Ecosystem.
Where Liquity USD sits in the market
With LUSD near $1.01, Liquity USD carries a market capitalization of $37.95M. Around $23.90K changes hands across exchanges in a typical 24-hour window. That is a turnover of about 0.06% of the float — on the quieter side, which can mean thinner liquidity for large orders.
Liquity USD carries no fixed maximum supply; issuance follows a programmatic schedule rather than a hard cap. LUSD trades about -5% below its all-time high of $1.07, within reach of prior peaks.
What the price history shows
The tape currently reads 24-hour -0.23%, 7-day +0.40%. Within its 366-day range, LUSD sits around the middle (the 50th percentile of recent daily closes).
Volatility profile
Recent action puts Liquity USD in the Low-volatility band — it has been relatively stable, with moves typical of large-cap, mature assets.
How to evaluate Liquity USD
A grounded read on LUSD comes down to three questions:
- Collateral backing — what secures LUSD, how over-collateralized it is, and how correlated that collateral is to the rest of crypto.
- Mechanism resilience — whether the peg has survived prior drawdowns, and how liquidations behave under stress.
- Decentralization trade-off — how much trust moves from a custodian to code — and whether that code has been battle-tested.
This page pulls live market data, on-chain stats where available, exchange-by-exchange volume, and our forecast model into one view so you can work through those questions in a single place. None of it is investment advice — it is a structured starting point for your own research.
