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

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The Terra blockchain’s quick rising stablecoin UST, which had surpassed its rival DAI to change into the most important decentralized stablecoin, has how attained one other milestone: a market capitalization of $10 billion.

According to the crypto pricing website CoinGecko, the UST market cap pushed previous $10 billion on Sunday. As not too long ago as the start of 2021, the market capitalization was underneath $200 million.

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

The quick development in UST comes because the Terra blockchain has change into a serious participant within the decentralized finance (DeFi) sector, the place stablecoins play a vital function in staking, liquidity administration and yield-generating.

Terra’s LUNA token has been one of many high performers amongst all digital property this 12 months, leaping 15-fold in worth to a reported market capitalization of $34 billion, in accordance to the crypto knowledge website Messari.

Last week, Terra overtook Binance Smart Chain (BSC) for second place in complete worth locked (TVL), a metric used to examine the DeFi exercise occurring on varied blockchains or for particular person initiatives. According to knowledge supplier 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 complete worth locked.

The hottest DeFi challenge within the Terra ecosystem is Anchor, a lending protocol with almost $9 billion in TVL, accounting for over half of all DeFi exercise on Terra.

A well-liked commerce includes customers depositing UST into the Anchor protocol, the place the tokens are subsequently pooled and lent out to interest-paying debtors. The accrued curiosity is then distributed professional rata to all depositors, who anticipate to earn an annual proportion yield (APY) of 20%.

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

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