These are exciting times for the Terra ecosystem. Although the LUNA price momentum struggles a bit right now, the UST stablecoin remains of great interest. Its market cap briefly surpassed $10 billion yet faces a minor setback right now.
UST Market Cap Shows Prominent Momentum
There has been a lot of talk regarding the future of stablecoins in the cryptocurrency industry over the coming years. However, it is evident these vehicles remain of great interest to traders and speculators alike. More importantly, there is strong competition among the available stablecoins as more people begin exploring alternative blockchains and ecosystems for their stability-oriented assets.
One asset noting strong momentum lately is the UST currency, residing on the Terra blockchain. Many people consider it a better version of a stablecoin as it takes a more decentralized approach to minting and redemption. Moreover, its use in decentralized finance – on the Terra chain – continues to grow day over day, creating more incentives for users to explore what this currency can do.
As demand for UST grows, so does the stablecoin’s market capitalization. Today, it rose above $10 billion for the first time, although that didn’t last too long. Why this blip occurred remains unclear, although it seems as if some people are moving out of UST again. That is not abnormal in this industry, even though the supplies of BUSD, USDT, and USDC hardly seem to dwindle these days.
Moreover, it is certainly possible UST will surpass this market cap again over the coming days. Even if the overall DeFi TVL of Terra dropped by over 16% in a day, it doesn’t appear to affect the overall momentum too much. The ecosystem remains at over $18.1 billion in Total Value Locked, which is more than respectable and well ahead of Binance Smart Chain, Solana, and Avalanche.
TerraSwap Goes Backward
Terra’s overall DeFi TVL decline is mainly due to TerraSwap losing over half of its liquidity. That is an astronomical figure, although things can still turn around in the days to come. Sustaining a 52.4% setback brings its TVL to below $880 million, although it remains uncertain why this outflow of funds took place now, of all times. That TVL decrease has little to do with UST surpassing and dropping below the $10 billion market cap, though.
Interestingly, most other DeFi projects on Terra saw their Total Value Locked increase again. Big gains are recorded for Stader, Loop Finance, ApolloDAO, and Anchor. It remains an exciting ecosystem for decentralized finance and other purposes. The $10 billion market cap for UST may only be the beginning, as this stablecoin has a lot of future potential in DeFi.
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