Liquity is an Ethereum-based decentralized borrowing system that uses LQTY, a USD-pegged stablecoin. With algorithmically calculated redemption and loan issuance costs, Ether holders can take out loans in the form of LQTY. The second token issued by Liquity Protocol is the LQTY token. The LQTY token is rewarded to Stability Providers and is used to incentivize Frontend Operators and early adopters. By depositing LUSD into the Stability Pool, users can earn Liquity token rewards.Liquity is a decentralized finance (DeFi) technology that makes it possible to borrow money without paying interest. Users can borrow the LUSD stablecoin by securing Ethereum (ETH) with a minimum collateral ratio of 110 percent. Users must pay a one-time borrowing charge while doing so. According to DeFi Pulse, Liquity is a governance-free protocol that employs an unique batching and fast liquidation strategy that has gained traction.