Currently, several blockchains contribute to the decentralized finance ecosystem. While most attention is focused on Ethereum or Binance Smart Chain, Avalanche is making great development. It’s now known as a chain that supports USDC natively, attracting even more attention to its burgeoning decentralized finance environment.
Avalanche Has a Lot of Benefits
Building on blockchain technology necessitates a strong foundation that allows accessibility, simplicity of use, fast transaction throughput, and minimal transaction costs. Ethereum, for example, does not fit under this category since it is a costly environment to conduct transactions or do other tasks. Furthermore, it is inappropriate for decentralized money and Apps because of their limited throughput. Despite this, Ethereum is still the preferred blockchain for DeFi, apps, and smart contracts.
At least in the case of Avalanche, such conditions will alter in the future. It’s a network with substantially greater throughput and reduced transaction costs, as well as a thriving decentralized finance environment. Avalanche currently hosts or is developing over 300 projects. According to a $200 million development fund for decentralized finance-related projects announced recently, that figure is set to become much higher.
Stablecoins, such as USDT and USDC, are an important part of DeFi. Users interested in DeFi options, such as lending, borrowing, and yield farming, can gain greatly from both currencies. USDT and USDC are available to Avalanche users, albeit the latter has improved slightly. The USDC currency is now issued natively on the blockchain, eliminating the requirement for the Ethereum-to-Avalanche bridge.
Adding this blockchain to Circle’s stablecoin expansion plan is part of the company’s overall goal of bringing the stablecoin to as many blockchains as feasible. Hedera, Tron, Ethereum, Algorand, Stellar, and Solana are among the other supported networks. Circle will also support over a half-dozen other networks in the next months. Avalanche is a natural pick and has significant potential since it is one of the top five chains by DeFi Total Value Locked.
Numerous DeFi Projects That Have Been Successful
Avalanche has swiftly ascended through the ranks of decentralized financial blockchains listed by Total Value Locked. It has just surpassed Tron and Solana as the fourth-largest ecosystem by TVL. Moreover, the gap to Binance Smart Chain is $4.2 billion. As Avalanche’s TVL grows by over 10% every week, claiming a spot in the top three remains possible.
Several successful DeFi projects exist in the ecosystem, including Benqi, Trader Joe’s, Wonderland, etc. These initiatives look into various products and services, such as yield farming, financing, borrowing, and liquidity provision, among others. Additionally, being a decentralized non-custodial liquidity market protocol, Benqi stands to benefit from the introduction of USDC on Avalanche.
Stablecoins are a crucial part of decentralized finance and the cryptocurrency sector. Accessing these currencies via low-cost, high-performance blockchains might help this business get more public attention. Furthermore, the continued rise of USDC as a top stablecoin demonstrates that investors are looking for active exposure to digital representations of the US dollar.