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Terra Becomes Second Biggest DeFi Chain, Surpasses BSC

terra bsc tvl defi 20 billion

Rising star of 2021 now has over $20 billion TVL

The Terra blockchain’s DeFi ecosystem has recorded an all-time high of $20.79 billion in total volume locked (TVL) on Friday. This places Terra in second place, ahead of Binance Smart Chain and behind Ethereum. This flippening is the pinnacle of a stellar 2021 for Terra, a blockchain that has seen consistent growth since the start of the year.

Terra’s DeFi ecosystem is quite varied with a combination of leading and cross-chain protocols leading the pack. Anchor is the biggest Terra native DeFi protocol, responsible for $8.99 billion in TVL. The cross-chain service Lido, which is also active on Ethereum and Solana, is in second place with $6.33 billion in TVL. Furthermore, TerraSwap grew 78% in the past 7 days and now has a TVL of $2.15 billion. 

Data from Defillama clearly shows the impressive growth Terra has gone through. Since December 14th its TVL grew from $11 billion to the current $20,79 billion. This growth doesn’t only come from more usage, but also the increased value of the native LUNA token. In the past 30 days LUNA increased its value 130% to the current $98.

Source: DeFiLlama

At this moment BSC has a TVL of just over $14 billion, giving Terra a clear lead. Ethereum remains king of DeFi with over $124 billion in TVL.

TVL important for more growth

TVL, or Total Value Locked, is an important measurement for the success of a blockchain ecosystem, because it basically says how much value the ecosystem has in its bank. The more value there is, the more interesting it becomes to build and participate. 

Even though TVL is a measurement used in DeFi, its importance stretches beyond that. Everybody who’s active in play-to-earn games or NFT collections often relies on the DeFi ecosystem to swap or acquire tokens. 

Binance Smart Chain became the second biggest ecosystem for DeFi in the beginning of 2021, and consolidated that position ever since. Until now, of course. In May the TVL on BSC surpassed $30 billion, threatening Ethereum’s leadership position. By the end of that month BSC’s TVL dropped to $11 billion and hardly moved above $20 billion for the remainder of the year. A similar pattern we’ve seen with Polygon, while ecosystems like Terra, Avalanche and Solana have made big moves since the summer. Read more about DeFi in 2021 in our Dapp Industry Report 2021

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