More efficient "money Lego"? Sorting out the "DeFi linkage" of Terra ecology

Original author: 0x137, Rhythm BlockBeats

Under the overall weak market environment, LUNA became one of the few projects with strong performance, and even set a new high in price. Unlike other public chains, Terra's DeFi ecosystem is fully supported by Anchor. As of now, Terra's TVL is about 17 billion US dollars, of which Anchor accounts for 13 billion.

Of course, if Terra wants to achieve sustainable ecological growth in the future, it is far from enough to rely on a trump card protocol. Recently, major protocols such as Astroport and Mars Protocol have gradually After landing, the future DeFi landscape of Terra's ecology has gradually become clear, and the composability and network effects have gradually become prominent.

Lending platform: Anchor, Mars

Anchor

Anchor can be said to be the engine of the current Terra ecology and UST popularity. By providing a stable APY of 20%, Anchor brings more predictability to stablecoin savings users source of income, thus attracting a large amount of UST deposits and loans.

Anchor uses the proof-of-stake network (PoS) verification rewards and the interest of borrowing users to generate a fixed interest rate for saving users.

On the Anchor platform, borrowers need to pledge bLUNA or bETH, these PoS assets, to lend UST. bLUNA and bETH are liquid pledge derivatives, "b" stands for "Bonded", which is the holding certificate issued by the Lido platform for LUNA or ETH pledged in the verification node. It can be used for free trading or as collateral. If bLuna is in the user's wallet, it will also generate UST staking rewards, which can be claimed under the "bAsset" page on Anchor.

After the user deposits bLUNA or bETH, Anchor will use these assets to pledge the node verification of the Terra network and the Ethereum 2.0 network, and obtain a stable pledge award.

Of course, a verification reward of less than 10% is definitely not enough to maintain a 20% APY for a long time, and the remaining 10% interest rate comes from the interest of borrowing users . In order to generate more interest rate income, Anchor rewards borrowers with ANC Token to encourage users to lend more UST.

This model is called "risk-free interest rate" by Anchor, and for most stablecoin holders, it can create a stable passive interest rate in the encrypted world Income is very attractive. In the past year, the TVL of the Anchor platform has also been steadily rising. Not long ago, it surpassed Aave to become the second largest lending platform in the encryption field, and will soon be connected to the Avalanche ecosystem.

But as more and more UST deposits After entering the platform, Anchor also began to face the problem of exhaustion of income savings. Anchor's governance vote also passed a plan not long ago to rely on modifying interest rates to ensure sustainability. But even if the interest rate is revised, Anchor still needs other protocols in the ecosystem to share the pressure. Protocols such as the Mars Protocol play an important role in this regard.

Mars Protocol

In fact, Anchor is more like a savings agreement, providing a fixed-rate savings service (Saving-as-a-Service) for individuals and agreements. Mars is different. Its interest rate is based on market demand, so the interest rate will fluctuate, which will bring different benefits.

Mars aims to become a universal lending protocol for the entire Terra ecosystem, supporting almost all tokens in the ecosystem as collateral. Although currently only UST and LUNA lending services are supported, the protocol can add various collateral assets through governance voting in the future.

Because many pledged assets do not generate PoS verification rewards, the rate income of savings users on the Mars platform all comes from the interest of the borrower , that is to say, the rate income of Mars is driven by borrowing demand, the more borrowing demand, the higher the borrowing rate on Mars.

In addition, Mars can provide unique C2C lending services for other protocols, so as to generate more lending demand. Recently, protocols such as Alpha Finance, Spectrum Protocol, and Apollo DAO have all cooperated with Mars in this regard.

Trading Hub: Astroport, Loop Finance

Astroport

Before Astroport, the main trading venue of Terra ecology was Terraswap. However, the functions of the application are very primitive. Before the version update, Terraswap only had basic trading functions, and liquidity providers could not see their own specific benefits. Compared with other ecological DEXs, there is a big gap in user experience.

The recently launched Astroport will be greatly improved. In addition to optimizing core functions such as slippage control, price impact preview, exchange rate and fee calculation, Astroport will also bring visual charts and analysis data to liquidity providers (LP) and traders, and provide LP with dual Token reward option, LP can choose to receive only one Token in the transaction pair as a reward, or choose to receive two Tokens at the same time.

In addition, Astroport also intends to refer to the veToken model, giving xASTRO and vxASTRO different degrees of voting rights, and sharing platform revenue between LP and ASTRO stakers.

The upgrade of Astroport in these aspects is very critical to the Terra ecology, because better pricing and efficiency will help other applications in the ecology to achieve integration and generate economies of scale. and attract more liquidity.

Loop Finance

In addition to Astroport, the DEX in the Terra ecosystem also has Loop Finance. However, Loop is not only a DEX, it is also a community with its own media platform, NFT market, venture capital funds, and mobile applications, and 25% of the platform fee will be used to purchase LOOP Token and distribute it to pledgers.

Creators can get LOOPR rewards by sharing valuable content in the Loop Community. Users can keep abreast of the latest DeFi project releases, and directly purchase or trade Tokens of these projects on Loop. Of course, Loop Ventures also incubates its own projects and then helps them launch.

And Loop's NFT market is the first market in the Terra ecosystem that focuses on the practicality of NFT. Pledge NFT through "NFT Bond", so that NFT can bring benefits to holders.

Highly combinable "Money Lego"

A big advantage of the Terra ecology is that the agreements are not fighting alone, but cooperative and competitive. With the lending and trading framework in place, other DeFi applications in Terra can collaborate with each other on this basis to form a highly combinable "Money Lego", thereby enhancing the network effect of the entire ecosystem.

Nexus Protocol

Nexus Protocol is the revenue optimizer of the Terra ecology. By establishing a revenue strategy for users, it maximizes returns while ensuring that users' funds are not liquidated. Vault is an income product launched by Nexus, which brings higher income to users by automatically generating income, rebalancing, optimizing transaction costs, etc. Users do not need to have a deep understanding of the mechanism of the underlying protocol to obtain the benefits provided by Nexus.

Currently Nexus only supports revenue optimization for Anchor. Users deposit bLUNA or bETH into the Vault and receive nLUNA and nETH as certificates. The deposited bLUNA and bETH will be deposited into the Anchor according to Nexus’ previously formulated income strategy and lent UST for savings operations, and the resulting income will be paid in the form of Psi Token. Recently, the Nexus team announced a partnership with Prism on Twitter, which will support revenue optimization for Prism in the future.

At the same time, users can also put their own nLUNA into the liquidity pool on Nexus, and the agreement will automatically provide it to Astroport and earn Take the Farming income, and finally pay the reward in the form of Psi.

Prism

Prism is a derivative protocol for LUNA, By decomposing digital assets into two different parts, the income component and the principal component, it helps users manage the risks brought about by price fluctuations and unstable income in a simple and efficient manner.

Users first need to stake their LUNA on Rrism and receive cLUNA as a certificate. The cLUNA can be decomposed into the main component pLuna (principal LUNA) and the income component yLuna (yield LUNA), where staking yLUNA can get staking rewards and airdrops, while holding pLUNA does not have many income options. Of course, there is a difference in the price of pLUNA and yLUNA after decomposition, so there is also room for arbitrage for traders.

Edge Protocol

Edge Protocol is currently in beta version, it is similar to Abracadabra of Terra ecology, allowing users to use their own interest-earning assets as collateral for lending operations, further improving Terra Ecological application composability and capital utilization.

For example, users who have UST savings on the Anchor platform can use their aUST as collateral for loop operations on Edge to improve their fixed APY. Of course, users can also choose to lend other assets to participate in various DeFi activities, such as LunaX.

Stader

Stader is building a middle-level infrastructure for pledge verification for multiple PoS public chains, and adopts a modular approach to attract third-party applications based on it Build multiple staking schemes. At present, Stader mainly provides liquidity staking for LUNA, and will expand to PoS public chains such as Solana and Ethereum 2.0 in the future.

LunaX is a liquid pledge derivative of the Stader platform. It is similar to aUST and is an auto-compounding accrual token.

Users can pledge LUNA on Stader and accept LunaX certificates, use LunaX as collateral to lend UST and LUNA on Edge, and deposit part of them in Anchor and LunaX- LUNA liquidity pool. Then use aUST to lend synthetic assets on Mirror to achieve compound interest.

Users can first convert LUNA to bLU NA or LunaX , lend UST on Anchor or Edge and deposit it into Anchor. Then use the aUST certificate to carry out liquidation arbitrage on ORCA to increase your own pledge income.

Apollo DAO

Apollo DAO is a revenue aggregator on Terra and a community-driven foundation. The income strategy on Apollo DAO mainly comes from providing liquidity for Astroport, and the income obtained will be automatically compounded, and at the same time, it will bring additional income to users in the form of rewarding APOLLO Token.

Apollo’s unique feature is that users can deposit UST directly, and the protocol will automatically convert it to the corresponding LP Token for you and start generating income.

Apollo's "Farmers Mark et" is also very interesting, This is a Launchpad, but the difference is that it uses Farming to start new projects and provide them with liquidity. Users also only need to deposit UST.

Osmosis

Of course we must not forget that Terra is also part of the Cosmos ecosystem. Not long ago, Terra Bridge began to support the transfer of assets between Osmosis Zone. Assets such as LUNA and UST in the Terra ecosystem can be easily transferred to Osmosis to obtain farming benefits.

It is undeniable that the popularity of UST is still need Anchor support. However, the development of the Terra ecology is gradually getting rid of "unipolarity" and gradually developing in the direction of "one superpower and many powerhouses". The construction of more composable applications can not only relieve the pressure of Anchor, but also generate a stronger network effect. Therefore, the DeFi development of Terra ecology also deserves our attention.

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