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DeFi Traders Push Terra’s UST Stablecoin to $10B Market Cap

Date : 
    2021-12-28

Posted by : Crypstarter Team

Category : Blog, news

Time : 
    08:37:01

The coin has surpassed Binance Smart Chain in total value locked amid rapid DeFi growth.

The Terra blockchain’s fast growing stablecoin UST, which had surpassed its rival DAI to become the largest decentralized stablecoin, has how attained another milestone: a market capitalization of $10 billion.

According to the crypto pricing site CoinGecko, the UST market cap pushed past $10 billion on Sunday. As recently as the beginning of 2021, the market capitalization was under $200 million.

Earlier in December, UST overtook rival MakerDao’s decentralized stablecoin DAI, whose market capitalization sits at around $9.4 billion. And DAI has been live since 2017.

The fast growth in UST comes as the Terra blockchain has become a major player in the decentralized finance (DeFi) sector, where stablecoins play a critical role in staking, liquidity management and yield-generating.

$UST marketcap is now $10B, the first decentralized stablecoin to achieve this milestone.

There is no more doubt in the product market fit of decentralized money in decentralized economies.

Long live @terra_money pic.twitter.com/f59ItpkgnJ

— Do Kwon 🌕 (@stablekwon) December 26, 2021

Terra’s LUNA token has been one of the top performers among all digital assets this year, jumping 15-fold in price to a reported market capitalization of $34 billion, according to the crypto data site Messari.

Last week, Terra overtook Binance Smart Chain (BSC) for second place in total value locked (TVL), a metric used to compare the DeFi activity occurring on various blockchains or for individual projects. According to data provider DeFi Llama, Terra boasts $17.9 billion in locked assets, versus $17.3 billion for BSC. The Ethereum blockchain sits comfortably in first place with over $162 billion in DeFi total value locked.

The most popular DeFi project in the Terra ecosystem is Anchor, a lending protocol with nearly $9 billion in TVL, accounting for over half of all DeFi activity on Terra.

A popular trade involves users depositing UST into the Anchor protocol, where the tokens are subsequently pooled and lent out to interest-paying borrowers. The accrued interest is then distributed pro rata to all depositors, who expect to earn an annual percentage yield (APY) of 20%.

According to data from TokenInsights, nearly $3 billion of all UST have been deposited into Anchor.

3/ @anchor_protocol , top 10 tvl protocol on the list, broke $10b on December pic.twitter.com/LStvaZhSxB

— TokenInsight (@TokenInsight) December 27, 2021

Source: CoinDesk

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