Avalanche continues to build strong momentum in the world of decentralized finance. Its overall Total Value Locked has risen sharply, making it the fourth-most valuable chain in DeFi. Moreover, the launch of the USDC stablecoin on this network will further enhance Avalanche’s appeal in this space.
The Growth of Avalanche
While most Defi activity takes place on Ethereum, Binance Smart Chain, and Terra, Avalanche continues to cement its industry position. It is a very active network that provides tremendous technical benefits, making it a solid contender for those three networks. In addition, the enhanced scaling opportunities of Avalanche’s technology stack make it a viable alternative to Ethereum, per the BofA.
Avalanche has smart contract capabilities that make it a viable developer environment for DApps, decentralized finance, NFTs, blockchain gaming, and more. Hundreds of projects are being built on the platform today, all of which benefit from its faster settlement times and lower network costs. Moreover, Avalanche’s network throughput is as high as 4,500 TPS, providing much better scalability than Ethereum or other ecosystems.
The recent addition of the USDC stable coin to Avalanche will unlock more opportunities for decentralized finance. USDC is the second-biggest stablecoin on the market and maintains a market capitalization of over $42 billion. The move comes right after the launch of a $200 million incubation fund for DeFi development on the Avalanche blockchain.
While USDC was available before – through a bridge from Ethereum to this blockchain – launching the native asset as part of the ecosystem is a significant move. Minting and printing USDC on Avalanche helps users save costs and removes the headaches associated with buying and selling. Moreover, USDC is more popular on Avalanche than Tether’s USDT, which is rather intriguing.
Beneficial To Various DeFi Protocol
The native launch of USDC on Avalanche will prove beneficial to the various decentralized finance projects in this ecosystem. One of the beneficiaries is BENQI, a decentralized non-custodial liquidity market protocol. Its native technology helps DeFi scale through various yield-generating products. Additionally, BENQI offers a lending and borrowing market, with liquid staking introduced later.
Lending and borrowing is a large part of decentralized finance. Users will often borrow crypto assets that can retain their value, and stablecoins make for an excellent option. The launch of native USDC on Avalanche will enhance the appeal of lending and borrowing protocols under Avalanche’s banner today and in the future.
Moreover, Avalanche has dozens of other decentralized finance protocols, products, and services where USDC integration can prove beneficial. As overall liquidity in the ecosystem continues to grow month-over-month, the addition of the second-biggest stablecoin by market cap can help keep the momentum rolling.
