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Wonky Mars Protocol launch shows ecosystem expansion may not add to network value

Published 03/29/2022, 01:39 PM
Updated 03/29/2022, 03:40 PM

New protocols are launching every day on different networks in the crypto space and the trend is likely to continue through this year. When looking at the top five networks by total value locked (TVL) — Ethereum (ETH), Terra (LUNA), Binance Smart Chain (BSC), Avalanche (AVAX) and Solana (SOL) — according to data from DeFiLlama, Ethereum have 579 protocols (including L1 and L2); Terra has 25, BSC has 348, Avalanche and Solana have 187 and 64 protocols, respectively. The low number of protocols and high TVL from Terra surely stand out as the outlier here.

Terra’s TVL reached an all-time high at $20 billion in December 2021 before dropping to $13 billion during the January 2022 crash. To date, the ecosystem has managed to boost its liquidity back to $26 billion.

LUNA is the tool that ensures the UST-USD peg

LUNA price is highly correlated with new protocol launches

LUNA February 2022 price. Source: CoinGecko
LUNA November to December 2021 price. Source: Flipside Crypto

ASTRO price and volume after the launch

ASTRO/UST price since Astroport launch. Source: TradingView
Astroport total swap count. Source: Flipside Crypto
Astroport trading volume in USD. Source: Flipside Crypto

Mars price and volume after the launch

MARS/UST price 4-hour. Source: TradingView
Mars Red Bank transaction count and volume in USD. Source: Flipside Crypto
Mars Fields transaction count and volume in USD. Source: Flipside Crypto

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