DYAD's Stablecoin Protocol Total Value Locked skyrockets by an astonishing 950% within a single month.
In the past month, DYAD, an Ethereum-based stablecoin platform, has seen its total value locked (TVL) surge to a record $35 million. This impressive growth can be attributed to several key factors.
Firstly, the high yields offered by DYAD have attracted a significant influx of liquidity. The platform's competitive yield farming strategies significantly outpace typical returns in the decentralised finance (DeFi) sector, making it an attractive option for investors. These high yields are a result of innovative protocol mechanics, optimised yield aggregation, and possibly strategic partnerships or new product launches within the DYAD ecosystem.
Secondly, the price of DYAD's native token, Kerosene (KERO), has seen a notable increase. This price appreciation has amplified the value of locked assets, further boosting TVL figures. The rise in KERO price can be attributed to heightened speculation, broader adoption of the DYAD platform, and positive market sentiment around the governance or utility of KERO tokens.
Thirdly, the growth and confidence in the DYAD ecosystem may also have played a role. There may have been recent announcements or upgrades enhancing DYAD's usability or security, instilling confidence among investors to commit more funds.
While detailed reports on DYAD's surge and KERO pricing dynamics are not readily available, the typical drivers for such TVL growth are expanded yield strategies and token price gains, reflecting growing user engagement and protocol adoption in the DeFi space.
Notably, Binance staked ETH is the only top DeFi protocol to have added TVL in September, while all other top 40 DeFi protocols have experienced a decline. In contrast, DYAD's TVL increase has defied the broader DeFi market, which is struggling at the beginning of the month.
Users can deposit Wrapped Ethereum (WETH), Wrapped stETH (wstETH), and other tokens to mint DYAD, which tracks the value of the US dollar. After minting DYAD, users can provide liquidity to the USDC/DYAD pair on Uniswap v3, targeting an annual percentage rate (APR) of over 45%.
The price of Kerosene, needed for minting DYAD and reducing the collateral ratio, has increased by approximately 1,000% within a few weeks. From $0.019 on August 5, the price of Kerosene reached a record high of $0.35 on August 30. This significant price increase may indicate increased demand for DYAD minting and a reduced collateral ratio.
It's worth noting that the collateral's value should exceed the minted stablecoins based on a ratio of 150%, but this ratio can be reduced to 100% by staking the native token, Kerosene (KERO).
In conclusion, the surge in DYAD's TVL and the notable increase in the price of Kerosene can be attributed to a combination of high yields, increased investor confidence, and the growing demand for the DYAD platform. As the DeFi landscape continues to evolve, it will be interesting to see how DYAD's growth trajectory unfolds in the coming months.
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