With DeFi exploding in recent times, Terra's stablecoin UST has quickly emerged as a strong player in DeFi, moving ahead to compete with the two giants USDT and USDC.
According to a report, stablecoin issuers have grown by 500% in “capacity” over the past 12 months. UST, one of the stablecoins in the Terra ecosystem, has already made some mark in this area.
UST has knocked out DAI to become the largest decentralized stablecoin by capitalization, joining the top 22 crypto projects by market capitalization.
UST's market capitalization was around $200 million in early 2021. By December 12, the asset's market capitalization had crossed the $2021 billion mark. This means UST has seen 10x growth since the start of the year.
$UST marketcap is now $10B, the first decentralized stablecoin to achieve this milestone.
There is no more doubt in the product market fit of decentralized money in decentralized economies.
— Do Kwon (@stablekwon) December 26, 2021
Now, although UST ranks first among decentralized stablecoins, it still lags far behind more famous centralized competitors like USDT, USDC or BUSD. However, the asset continues to make big strides to close this gap.
Two leading exchanges, Huobi and Binance, have announced the listing of UST. Specifically, Huobi will bring the asset into the Pioneer Zone on December 23, while Binance will offer three different UST trading pairs: UST/BTC, UST/BUSD, and UST/USDT.
After just these two announcements, more than 200 million USTs were issued. This may have influenced the price increase of LUNA (Terra's native token).
The LUNA price has a direct proportional correlation with the increase in UST supply.
At press time, LUNA is trading in the $91 region, down nearly 10% over the past 24 hours. However, with UST demand growing exponentially, $100 for LUNA is just another milestone, not a goal. In terms of total locked value, the network surpassed the $21 billion mark, second only to ETH.