Always under the radar, the humble altcoin Tron (TRX) been a leading asset in decentralized storage platforms. So far, TRX has been one of the less volatile digital assets but that might change very soon. With a new stablecoin, Tron (TRX) is now holding the third largest TVL in its reserves. Because, at this point and time, the world is in dire need of another algorithmic stablecoin. Nonetheless, investors are now rushing to put capital into Tron’s smart contracts for those juicy returns.
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Tron (TRX) Total Value Locked
TRON is a decentralized, blockchain-based network that aims to create an open, global entertainment infrastructure for digital content with distributed storage technology and enables digital content to be exchanged quickly and cost-effectively. Continue reading “What is Tron (TRX)”.
However, much like all crypto projects, the initial purpose becomes irrelevant and they have to start an algorithmic stablecoin.
Recently, the Tron network introduced Decentralized USD (USDD), an algorithmic stablecoin. Apparently, USDD has had a massive role in increasing the total value locked in Tron smart contracts.
According to analytics platform DeFi Llama, Tron is now the third largest blockchain in terms of TVL at $6.03 billion.
Basically, TVL of a blockchain represents the total money held within the smart contracts. Of course, it comes with interest rates as rewards. To calculate TVL, we multiply the amount of collateral locked into the network by the current value of assets.
How Did Tron Attract This Much Capital?
Short answer is, 23% annual returns! DeFi Llama noticed that over half of the capital within the smart contracts comes from JustLend (JST). JustLend is a decentralized finance lending and borrowing protocol. With a closer look, we see the platform offers an annual percentage yield of over 23% for USDD holders. To put that in perspective, Russian banks currently offer 20% annual percentage yields. No this comes from a country that is at war and enduring the largest amount of sanctions ever.
According to data, it is clear that the growth in TVL for Tron (TRX) is caused by a quick increase in USDD market cap. Since May, Tron’s total value has almost doubled from $3.73 billion to $6 billion. Within the same period, USDD market cap moved from $269 million to $603 million with a 123% increase.
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