LUSD is solely backed by ETH and is 268% collateralized. This is well above the minimum CR of 110% for individual vaults and 150% for the protocol as a whole.
Note: Please see the Mechanism section for an explanation of LUSD's stability.
All of LUSD’s reserves are held in Liquity’s fully audited contracts. These contracts have been audited by Trail of Bits and Coinspect.
Our score does not reflect whether Liquity’s smart contracts are technically sound and error-proof. Rather, it indicates the general relative safety of protocol-owned smart contracts compared to third-party smart contracts, multisig wallets and EOA accounts.
ETH reserves are fully segregated for the benefit of LUSD holders and trove owners.