What is TeFi?
Decentralized Finance on Terra
As I alluded to in my first post, I am a $LUNAtic and I believe Terra will be one of the 3 major blockchain ecosystems in the months to come. From reading almost anything I can on different crypto ecosystems and also trying different DeFi protocols that have big user bases since January this year - Terra to me stands out as the only chain so far that is truly focused on onboarding the greatest number of people into Decentralized Finance (DeFi).
Most of these use cases and upcoming projects are centered around the utilization of the biggest algorithmic stablecoin in the market today: Terra $UST and a host of other stablecoins like $PHT, $MNT, $EUT, among many others pegged to major currencies worldwide (I will talk about $UST in my next post).
While there are good experiments on Ethereum and other chains - Terra is the only one with existing real world use cases (Chai in South Korea, Memepay in Mongolia) as well as an almost unrelenting drive towards inspiring builders to create real-world usable protocols such as KadoPay and Alice Finance.
Terra is the 3rd ecosystem with the largest Total Value Locked (TVL) among 77 chains currently tracked by DeFiLlama.
This is nothing short of miracle with only around 10 DeFi protocols currently out compared to 337 in Ethereum and 209 in Binance Smart Chain (BSC).
We are expecting over 150 new DeFi protocols and other projects to launch within the next few months as a result of the latest Columbus-5 upgrade to the network 2 months ago.
What is Terra and $LUNA?
Terra was created by a blockchain company called Terraform Labs (TFL) and it is a protocol that creates stablecoins pegged to various fiat currencies.
The native cryptocurrency coin of the Terra ecosystem is $LUNA. $LUNA is burnt to mint the stablecoins. The most popular stablecoin in Terra is of course, $UST - which is currently pegged to the US Dollar.
$UST as of December 11, 2021, is the 5th largest stablecoin after USDT, USDC, BUSD and DAI. It has a market capitalization of $8.6 billion which grew by almost 200% in the last 30 days.
Founders:
Do Kwon - holds a degree in Computer Science from Stanford; named in the Forbes 30 under 30 list in 2019
Daniel Shin - graduate of the Wharton School of Economics; Founder of TMON, Fast Track Asia and Chai Payments
While Terra was built by Terraform Labs, the protocol is owned by its users and anyone with the knowledge and skills can build on top of it.
Do Kwon has stated many times that when the ecosystem matures in the future, there would be no need for Terraform Labs anymore.
You can visit the following resources to learn more about Terra:
Terra’s main website
A comprehensive guide by The Generalist entitled Terra: The Moon Also Rises
CoinMarketCap’s coverage on Terra $LUNA