How is UST compared to USDC? USDC is Centralized UST is decentralized power. For Terra are very clear about “A decentralized economy needs decentralized money.”
Flood Capital expressed: UST has grown its dominance from .67% to over 6% in 2021 with barely any exchange listings and only 2 main apps, Anchor and Mirror. Given this growth in 2021 and upcoming catalysts, 150% growth in 2022 isn’t unreasonable. Meaning UST at 23B EOY 2022. So, what are the catalyst?
Development of TeFi Some notable applications: Sophisticated DEX @astroport_fi (Think Uni V2, V3, Curve and Balancer) Money Markets, @mars_protocol (Think AAVE and Compound) Leverage Trading, @Levana_protocol Comparable apps on Ethereum have 10’s of billions in TVL.
Terra’s TVL is supercharged, as every dollar entering is in the form of native tokens or UST. This equates to buy pressure for the native token or LUNA burning. An analogy for this would be if every time USDT, USDC, or BUSD was created on ETH an equivalent amount was burned.
This has made me realized TeFi is our best shot at true decentralized finance. ETH and basically all other chains “DeFi” can be controlled by a few stable coin providers. I wonder the activity/premium this will drive to TeFi when it is fully understood?
Decentralized Stable coin If we want truly decentralized finance, we need a decentralized stable coin. Currently most of ETH DeFi could be held hostage by the issuers of USDT and USDC.
With more regulation on stable coins this will continue to push marginal users and more importantly developers to choose UST as a decentralized solution.
Terra has a massive treasury and the community is beginning to deploy it. Accumulating CRV and CVX to perpetually incentivize Curve pools with UST.
Exchange listings UST is now a top 20 coin and is still missing major exchange support like Binance and FTX. I think this will change in 2022, see HUBOI listing UST.
Community Response: Terra is using crypto to build practical products. Unlike some other projects, Terra is grounded in the real world. It is used by millions of people to pay for everyday items, without the need for those users to interact with the blockchain!
Great point. However, TEFI really need to sort out protocol concentrated risk. Ordinarily UST should be the reason for multiple expansion. Yet Luna’s mcap/TVL still couldn’t get over 2.
Why is it bad, less selling pressure on LUNA if TVL is high? TVL comes and goes if the liquidity concentrates on a few dapps. Terra is creating an anti-cyclical TEFI environment to ensure steady UST demand. Correction back in May caused UST to temporarily unpeg and massive -70% drop.
That makes sense until wrapped centralized stable coins enter Luna eco. TVL matters and this will happen once AGORIC happens via IBC.
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