The central theses
- The network has exceeded $ 18 billion worth of assets in DeFi-Logs are locked while the LUNA’s LUNA climbs to new all-time highs.
- Terra has become the second largest DeFi network, overtaking Binance Smart Chain.
- The network’s native LUNA token also has a new one All time high of $ 84.92.
- LUNA’s price hike along with new DeFi protocols on Terra helped the network reach second place.
- Terra has overtaken Binance Smart Chain Locked, the second largest DeFi network after.
Terra takes second place
DeFi is booming on Terra. The network surpassed Binance Smart’s total chain value, locked in DeFi logs over the weekend as its native LUNA token climbed to new all-time highs.
Terra currently hosts over $ 18 billion worth of assets through its 13 DeFi protocols. A combination of rising prices and liquidity from new protocols has pushed the overall value of the network back in second place.
Since hitting its previous all-time high in late November, Terra’s LUNA token has skyrocketed and rebounded quickly while the rest of the market has given way. Today LUNA shot to a new all-time high of $ 84.92, up more than 85% over the last month.
LUNA / USD price chart.
The decreasing supply of LUNA tokens in the market is likely to drive up the price of LUNA. For example, in October the Terra community voted to burn about 10% of the LUNA token offering worth about $ 4 billion.
The increasing demand for Terra’s native, algorithmically bound Stablecoin also affects the price of LUNA. UST can be minted by burning LUNA worth USD 1 in return, reducing the LUNA supply as more stablecoins are produced.
While the price increase of LUNA has made Terra the second largest DeFi network, the introduction of new protocols has also attracted more liquidity. Astroport, a new decentralized exchange starting on Terra, has brought more money into the ecosystem with its much anticipated “lockdrop”.
Users who lock their liquidity in the log will receive token airdrops based on how long they lock their assets for. To date, this has tied assets worth over $ 1.1 billion to Astroport, more than half of which are LUNA tokens, further reducing the supply of liquidity in the market.
While the total value locked on Terra has increased significantly, other Layer 1 chains have lagged. For example, Binance Smart Chain has failed to break its previous all-time high of $ 31.6 billion, which it hit in May.
While other Layer 1s like and saw steady growth, they haven’t been able to keep up with Terra over the past month.
Source: Crypto News Deutsch