- Terra proponents envision the layer 1 blockchain may soon outpace Ethereum.
- The performance of Terra’s LUNA token, as well as its UST stablecoin, have been fueling the optimism.
- Terra still has a long way to go to catch up with Ethereum.
Newer blockchains continue to jostle to attain the coveted top position of the market-leading smart contracts ecosystem, Ethereum. To some market participants, Terra (LUNA) just may be the crypto asset to finally flip the OG smart contracts blockchain.
Can Terra flip Ethereum?
According to Jon Farjo, the founder and chief product officer of the crypto social analytics platform LunarCrush, Terra has long been in contest with Ethereum.
In a recent tweet, the CPO stated despite LUNA currently having about one-tenth the market of Ether (ETH), the crypto asset has a good shot at flipping the number two crypto. He adds that Terra may be the most significant project since Bitcoin.
The comment is coming on the back of Terra’s outperformance of Ethereum in some metrics. LUNA recently surpassed ETH to become the second-largest staked asset but has just also flipped Solana and is now the largest staked asset per data from Staking Rewards which tracks earnings on proof-of-stake blockchains, over $31.6 billion worth of LUNA tokens is staked by users to earn yields of over 6% annually. In comparison, ETH 2.0 staking holds about $24.5 billion worth of ETH earning around 4% yield while Solana currently has around $31.5 billion in staked value.
This is coming after the price LUNA has put in an impressive growth over the last few weeks. LUNA has increased more than 40% in the last few days to currently be trading at around $101. At the peak of the recent surge yesterday, the price of LUNA matched its previous all-time high of $102.
Similarly, market participants are also bullish for LUNA and the Terra blockchain due to the success of its flagship stablecoin Terra USD (UST). The market cap of the algorithmic stablecoin, which is pegged to LUNA, has now reached $14 billion and is the fourth largest stablecoin.
However, Terra still has a long way to go in its bid to surpass Ethereum. In terms of market cap and DeFi TVL, Ethereum remains king. Ether has a market cap of over $312 billion compared to Terra’s around $36 billion.
Similarly, Ethereum’s DeFi TVL is over $118 billion compared to Terra’s $23 billion, although the latter has been noted to be one of the blockchain’s eating into Ethereum’s DeFi dominance.
The other contenders for Ethereum’s dominance
Aside from Terra, there are multiple other Layer 1 “Ethereum killers” out there. Some that have been noted to have the potential to be threats to Ethereum include Solana, Cardano, and Polkadot.
At present, these blockchains offer users cheaper transaction fees and faster transaction times than Ethereum. However, the crypto giant remains confident that it will continue to maintain its dominance.