TL: DR Breakdown
- The UST has increased its market cap to eclipse even the Binance Smart Chain network.
- UST is the first decentralized stablecoin and is powered by Terra Luna
Days after its listing in Binance and Huobi exchanges, the UST is doing wonders. Its total value locked is increasing as many DeFi traders choose it over other Stablecoins. Now it brags a market capitalization of over $10 B that is even higher than the Binance Smart Chain network.
Terra Luna’s stablecoin UST has recently broken records and set new milestones. It started by outgrowing DAI to become the largest decentralized stablecoin. Now it has set a new record by achieving a market cap of $10 B.
$UST’s exponential growth
According to data from CoinGecko, the stablecoin pushed past the $10B mark on Sunday. This coin started in 2021 with a considerably lower market cap of less than $200 million. It began gaining traders’ attention, and in December, it outgrew DAI, which had a market cap of $9.4 B. DAI premiered in 2017, and it had to bow to a newer stablecoin, UST.
UST’s success has attracted the attention of DeFi traders. DeFi mainly uses Stablecoins to facilitate features like staking and yielding. Other DeFi assets also require Stablecoins for the management of their liquidity.
Yesterday, the CEO of Terra labs, Don Kwon, tweeted about the achievement of UST. In his post, he described it as proof of a perfect market fit for decentralized monies in decentralized economies. His tweet has gained 7.1 K likes so far.
More about Terra and its UST Stablecoin
UST is a decentralized stablecoin from Terra Labs run by the LUNA token, which helps mint it. The more the Stablecoins minted, the fewer the LUNA coins remain in circulation. As a result, the popularity of the UST contributes positively to the rarity of the coin minting it, LUNA.
LUNA has also been among the best tokens of the year 2021. Per data from Messari, its price has shot up 15 fold and achieved a market cap of around $34 B. Last week the Terra network overtook Binance smart chain in TVL. The Total Value Locked helps to compare the activity of traders and assets locked in blockchains, in this case, DeFi.
Per data from DeFiLlama, Terra has a TVL of $17.9B, which is slightly higher than the Binance smart chain that holds $17.3 B. ETH is the leader in this sector, boasting over $162 B in TVL. The most significant DeFi protocol on Terra Network is Anchor. This lending protocol boasts a TVL of $9B, over half of the total TVL in the entire network.
Now, traders are using the UST coin in the liquidity pools of Anchor to earn profits on their holdings. The interests are then distributed to the investors at an APY of 20%. According to data site TokenInsights, Anchor pools hold UST worth over $3B.