Terra, one of the fastest-growing DeFi ecosystems, is looking to capitalize on its 2021 Q4 successes by expanding its DeFi use cases. On January 6th, Terra revealed its game plan: ‘UST Goes Interchain: Degen Strats Part Three.’
In the new governance proposal, Terra is looking to provide $139.7 million in UST and LUNA to five leading DeFi projects to build “awesome UST use-cases.” The fund will be distributed over three to six months.
Decentralized Stablecoin Goes Interchain
According to the proposal, the fund would be used to expand the interchain deployment of its UST stablecoin across five projects which are built on Ethereum, Polygon, and Solana.
The introduction of the decentralized cross-chain stablecoin (UST) would look to take on the centralized stablecoins (USDT and USDC) that have dominated the crypto industry for a long time.
The community has warmly received the proposal, with generally positive remarks being made about the proposal. Should the proposal pass, the funds would be allocated as follows:
- DeFi liquidity provider and market maker Tokemak would receive a $50 million deposit in UST (six months);
- Rari Fuse, permissionless lending and borrowing platform, would receive $20 million (six months);
- Yield aggregator Convex Finance would receive $18 million (six months);
- Decentralized reserve currency protocol OlympusDAO (OHM) would receive $1.45 million (three months);
- Terra would expand its Solana reach by contributing $250,000 in UST to create IN/UST bonds in InvictusDAO, a decentralized reserve currency.
On the Flipside
- Terra has lost its position as the second largest defi ecosystem to Binance Smart Chain.
Why You Should Care
having already become the first decentralized stablecoin to top $10 billion by market cap, Terra’s proposal could increase the market share of TerraUSD.