Algorithmic stablecoin platform Terra has hit a new all-time high as fellow Cosmos-based coins have posted double-digit gains in the last day.
Having surpassed Binance Smart Chain as the second-largest decentralized finance (DeFi) protocol on Tuesday, Terra’s LUNA token today reached an all-time high of $97.90. At time of publishing, LUNA is just over $95, up 12.8% on the day, per CoinGecko.
Despite just 13 projects built on the Terra ecosystem, the total value of assets locked (TVL) in the protocol has now reached $20.7 billion, up 15% over the past day, and 64% in the past week, according to DefiLlama.
Terra is a Cosmos-based blockchain for creating algorithmic stablecoins pegged to various fiat currencies, such as the U.S. dollar or the euro. It became the second-largest DeFi protocol in terms of TVL after surpassing Binance Smart Chain on Tuesday.
The increasing activity in projects like savings protocol Anchor, which saw its TVL grow to $8.8 billion in the last 24 hours, is also having a positive impact on TerraUSD (UST)—Terra’s U.S. dollar-pegged stablecoin.
With a market cap of just $9.4 billion, UST is currently not only the world’s 20th largest crypto asset, but also the market’s largest decentralized stablecoin.
Despite its impressive gains, Terra’s TVL still sits some way below the industry’s most popular smart contract platform Ethereum, which boasts $155.5 billion in TVL, or almost two-thirds of the entire DeFi sector.
Cosmos coins surge
According to Terra founder Do Kwon, rapidly growing demand for UST is the main driving force behind a more than 60% surge in the price of Terra’s LUNA token over the last week.
“LUNA’s price appreciation is a function of the demand for UST via seigniorage,” Kwon told Asia Markets. He suggested that demand for UST could grow in early 2022, before reaching an “inflection point” by the end of the next year.
“Currently, dozens of projects are in the audit pipeline and are gearing up for launch in the first quarter of 2022, which could amplify UST demand momentum rapidly once live,” Kwon said.
Previously, Do Kwon revealed that there could be more than 160 new projects launching on Terra in 2020, including highly anticipated decentralized exchange Astroport and borrowing and lending protocol Mars.
Alongside Terra, other Cosmos-based coins have enjoyed double-digit gains in the last day, with Cosmos’ own ATOM up 10.8% to $25.52, and OSMO, the token of decentralized exchange (DEX) Osmosis up 13.0% to $5.32.
Source: https://decrypt.co/89034/terra-hits-new-all-time-high-as-cosmos-coins-post-double-digit-gains
