Amid LUNA’s trip to the moon and Terra’s exploding TVL, watch out for this
Bullish investors were over the moon when Terra [LUNA] enjoyed a brisk rally that took it from $50 to over $100 in a matter of days. Even in its recent report about the asset, Messari tweeted that LUNA had “firmly planted itself on the moon.”
However, before you whip out your wallet and get ready for lift-off, read this.
At press time, LUNA was trading at $93.64, having corrected by 0.70% in the last 24 hours, but rising by 8.88% in the last week. Furthermore, LUNA was performing well at a time when a number of other popular alts and so-called “Ethereum killers” were flailing in the red.
Messari proposed two reasons for LUNA’s ascent. One was the Luna Foundation Guard (LFG) raising $1 billion for a Bitcoin reserve for UST. The second was an uptake in usage and LUNA fundamentals.
That being said, Messari noted that while Terra’s TVL was rising, its CMC was not matching the relative growth rate. This led to it moving out of the band containing rivals such as BSC, Avalanche, and Fantom.
<p lang=«en» dir=«ltr» xml:lang=«en»>4/ Even with @terra_money's 30d price increase of 76%, its CMC has not kept pace with its relative TVL growth, implying that investors are either intentionally discounting this TVL growth or unintentionally failing to grasp its competitive positioning. pic.twitter.com/N22q780eiU— Messari (@MessariCrypto) March 24, 2022
So, Terra has a rising TVL on its side, but what is boosting said TVL? According to Messari, the clear answer was debt protocols, with a growth of around 96% in the past 90 days.
<p lang=«en» dir=«ltr» xml:lang=«en»>5/ Debt protocols account for roughly half of the entire network’s TVL, and at nearly 96% growth in 90 days, they are the fastest-growing DeFi sector in TVL. @anchor_protocol's Read more on ambcrypto.com
