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In contrast, Ethereum 2.0 still holds the top position in terms of total locked value in the Defi protocol
Terra has made its place in the list when it comes to top cryptocurrencies but continued to surge its position. For now, it holds the seventh-largest cryptocurrency in terms of market cap and value. The prestige held by the Terra network also reflects on other factors.
Recently Terra network became the second most staked digital asset by value. The network stands at $28 billion worth of its native LUNA token, almost 40% of its total available tokens, staked to keep the blockchain functional. Surpassing the flagship Ethereum 2.0 in staking value, Terra network only lags behind Solana that is currently at the top position with approx $35 billion SOL token staked.
However, Ethereum is still unbeatable regarding the total value locked in Defi protocols across various blockchains. The Defi space is valued at more than $200 billion, locked in defi protocols in different platforms. Out of this total value locked for Defi space, Ethereum alone has a staggering amount of more than $110 billion locked. Terra is in second place in the same space but has $23.7 billion in TVL, which is the network’s all-time high yet far behind Ethereum TVL.
The terms used here are staking and total value locked; those are whole distinct spaces where different networks perform differently. Total value locked is meant for when crypto users put their digital assets in a Defi protocol that keeps the capital used for different purposes and helps users earn interest on their deposits.
On the other hand, staking is the process when a user needs to stake a certain amount of crypto assets, which varies from network to network, to be a validator on the network. This follows the consensus mechanism of Proof of stakes, where validators who stakes most crypto assets will be chosen to validate the transactions per block.
If a validation block is proposed as invalid, then the validator loses his staked coins. On the other hand, if the validator performs the validation correctly by following the consensus rules, he gets rewarded with the transaction fees attached to block transactions.
These staking rewards are also highest on the Terra network for now, as they get high and low according to the performance and activities on the network. Solana and Ethereum give 5.93% and 4.81% as rewards, respectively; at the same time, Terra provides an annualized reward of 6.62% on staked coins.
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Nancy J. Allen is a crypto enthusiast, with a major in macroeconomics and minor in business statistics. She believes that cryptocurrencies inspire people to be their own banks, and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning. She frequently researches, and posts content on the top altcoins, their theoretical working principles and technical price predictions.
