It's a sidechain, created by Blockstream that came out a couple of years prior to the LN. It is more centralized, but faster, cheaper, and more private. You can peg in or out 1:1 with Bitcoin into Liquid Bitcoin. Once in L-BTC, there are DEXs that trade assets like stablecoins and other tokens.

Here's a 3min video if you're interested: https://youtu.be/ipBSTuxMlLc