Lyra is a decentralized finance (DeFi) protocol designed to be an open, provable, and community-owned marketplace for crypto options. It utilizes a specialized automated market maker (AMM) to price and trade options, aiming to solve the problem of low liquidity that often affects crypto derivatives markets. By pooling liquidity and using a dynamic pricing model, Lyra enables users to trade options on various cryptocurrencies with competitive pricing and deep liquidity directly on the blockchain. The protocol was initially launched on Ethereum Layer 2 solutions like Optimism and has expanded to other networks like Arbitrum to offer lower transaction fees and faster execution.