$139M Terra proposal to ‘bring awesome UST use-cases’ to DeFi projects
Decentralized stablecoin issuer Terra issued an ambitious proposal to expand the interchain deployment of its UST stablecoin across five projects on Ethereum, Polygon, and Solana.
Terra’s Jan. 6 Research post UST Goes Interchain: Degen Strats Part Three provides details about how $139 million of UST and its native stablecoin LUNA would be utilized and on what platforms if the proposal is passed.
Terra is a blockchain that supplies algorithmic stablecoins and LUNA has market cap ($28.5 billion).
In each proposed deployment, Terra would deposit UST in varying amounts from $250,000 to $50 million to boost the stability of each of the new partner projects. The main aim is to “bring awesome UST use-cases to Ethereum DeFi.” A vote for governance participants to approve the proposal will be held at a later date.
Terra founder Do Kwon made it clear in a Dec. 21 tweet that he wishes UST to be the dominant stablecoin in the crypto market. The distribution aims to help Terra accelerate its efforts in growing its market cap. Currently only stablecoins BUSD ($14 billion), USDC ($43 billion), and USDT ($78 billion) have a higher market cap than UST ($10.3 billion).
DeFi liquidity provider and market maker Tokemak on Ethereum would receive a $50 million deposit in UST for at least six months if the proposal passes.
Permissionless lending and borrowing platform Rari Fuse would receive $20 million UST for six months. The funds would be deposited into three pools on Fuse to help UST become “cheapest stable to borrow” on Fuse.
Yield aggregator Convex Finance on Ethereum would receive $18 million for 6 months. Terra would inject greater LUNA incentives for liquidity providers in several pools across the platform that use UST. Convex is one of the
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