Terra's (LUNA) total value locked (TVL) has outstripped popular smart contract-backed blockchain networks such as Binance Smart Chain, Fantom, Avalanche, and Solana. With the demand for DeFi services increasing, Terra Network has surpassed $22 billion in total locked value (TVL) as of early March.
Terra opened the first day of the second month of 2022 with a total locked value of $13.4 billion. Since the launch of Terra 2018, DeFi is getting more attractive to users. This continues to help facilitate the adoption of digital assets. In the first few years of its launch, Terra had over 73 projects in its ecosystem.
By Q4 2021, Terra's TVL had increased significantly by 248%, closing June with an all-time high of $3.42 billion.
In October, Terra co-founder Do Kwon pointed to about 160 new projects to be launched on the protocol.
"Now that Columbus-5 is on the air, more than 60 new projects are set to begin in the next six to eight weeks, and more than 100 have announced plans for the end of the year or early 2022."
Following the successful network upgrade of Columbus-5, expectations for the platform rose. Columbus-5 has provided Terra with several new and updated features, particularly a change to the operating mechanics behind the native LUNA token.
Alongside the network upgrade, Terra's growth in 2022 is also attributed in part to Nexus Protocol (PSI), Spectrum Protocol (SPEC), Stader, Astroport (ASTRO), Lido (LDO), and Anchor (ANC). Nexus Protocol's TVL increased more than 90 percent, Lido Protocol surpassed Aave by more than 130 percent in March, and Anchor increased more than 57 percent.
The most exciting project to raise Terra's TVL to $22 billion came with the announcement that Terra's stablecoin TerraUSD (UST) is backed by a $1 billion Bitcoin reserve.
UST, unlike other stablecoins backed by the US dollar (USD), is pegged to USD through a mint and burn transaction for its native token LUNA. If the price of a stablecoin drops below $1 per coin, UST can be instantly traded for LUNA, which can then be minted and then sold for $1, providing arbitrage gains for investors. As a result, as the demand for UST increases, the LUNA tokens will constantly burn, making it a deflationary asset and its price will increase.
As for what's on the chain, Do Kwon explained that as of March, there are a total of 73 projects on the chain, and at least 87 more projects will be launched on the chain by the end of 2022.