ℓUSD
Crypto Overview
Overview
LUSD is an algorithmic stablecoin that is part of the Liquity protocol, designed to maintain a soft peg to the US Dollar. It is minted when users deposit ETH as collateral into the protocol. The system uses a minimum collateralization ratio of 110% and implements automatic liquidations to maintain the stability of the peg.
Purpose and Utility
The primary purpose of LUSD is to serve as a decentralized stablecoin within the Ethereum ecosystem. Users can mint LUSD by depositing ETH collateral, effectively creating a collateralized debt position. The protocol is designed to be governance-free and fully automated.
Business Model
The protocol generates revenue through liquidation fees and borrowing fees, which are distributed to LQTY token holders. The system operates without any admin controls or governance, making it fully decentralized.
Real-World Adoption
LUSD has achieved significant adoption within DeFi protocols and maintains active trading volumes across various decentralized exchanges. The protocol has maintained a stable total value locked (TVL) and continues to serve as collateral in various DeFi applications.
Platform Development
The protocol's development is active, with regular updates and improvements to the system. The codebase is open-source and has undergone multiple security audits.
Token Distribution
LUSD is minted by users when they deposit ETH collateral, ensuring a fair distribution model. There was no pre-mine or initial allocation to founders.
Crypto Impact
To assign a comfort level investing in ℓUSD from a halal perspective we need to determine whether it has a net positive or negative impact.
Towards this end, the table below is used to tally all the positive and negative considerations our members can think of related to ℓUSD.
If you don’t see something that should be listed, positive or negative, feel free to submit your own contribution using the button “Contribute”.
We will review your contribution for accuracy before publication.
Importantly, you can review listed contributions and vote on which one you think has the greatest impact, positive or negative.
You only have one vote per asset so use it wisely.
You can change your vote if you change your mind.