One year and 22 protocols later, Terra has become the second-largest DeFi blockchain. How did it happen, and how long can it hold on to the top spot?
As part of a 50-page report, Cointelegraph Research examines Terra’s most recent developments, including Columbus-5 and the Bitcoin (BTC) acquisition, in great detail.
What is all of this, and is it actually working? The Big Four and top universities around the world send a team of professional crypto experts to investigate the blockchain’s ecosystem, community, and underlying technology in order to analyze the possible regulatory, market, and technological concerns.
Terra Luna’s Advantages
Terra is a blockchain ecosystem based on proof-of-stake that intends to make cryptocurrencies more widely usable as a payment method. They have successfully implemented the dual token concept, which allows them to regulate the supply and price of all of Terra’s stablecoins, including the USD (UST), GBP (GBP), KRW (KRW), EUR (EUR), and TerraSDR (TerraSDR).
Additionally, transaction fees and LUNA’s burn rate variations help to reduce the volatility of mining payouts. In addition, as the blockchain’s ecosystem expands, the incentives will rise in value.
A number of Terra blockchain developers simultaneously develop Decentralized apps (DApps) like Mars Protocol, Anchor, and Chai. Companies like Kado have built the infrastructure for payments. Levana, Talis, and Knowhere are attempting to build a sustainable ecosystem around non-fungible tokens (NFTs). A DeFi and NFT aggregator on Terra, TFM wants to bring the Terra ecosystem together and become the go-to destination for newbies.
Can Terra Maintain Its Growth?
However, the crypto influencers rarely bring up the issues of decentralization and regulation. Will Terra be able to keep up with its rapid growth if just 130 validators exist? It’s impossible to predict what would happen if the US Securities and Exchange Commission tried to regulate UST. Finally, what if one of the most popular DApps, Anchor lending, had failed at the end of January 2022?
