Due to the expansion of DeFi outside of Ethereum, Pancake Swap and Terra prices surge

[Digital Today Reporter Chi-Gyu Hwang] While decentralized finance (DeFi) projects using block chains continue to grow rapidly in 2021, the growth of DeFi services created outside of Ethereum is also remarkable.

According to a report from cryptocurrency data service provider Mesari, the two DeFi protocols that performed the highest in the first quarter came from a blockchain platform other than Ethereum.

According to Mesari, Terra, a blockchain platform based on Binance Smartchain (BSC), a blockchain platform launched by global cryptocurrency exchange Binance, that provides pancake swaps and stablecoins, has the highest performance in the first quarter of this year. Ranked 1st and 2nd in Protocol.

Pancake Swap, a service similar to Uniswap, an Ethereum-based DEX, provides its own token, Cake. Cake tokens are used by users to receive rewards or vote for project updates. Cake token price surged 3031% this year alone, overtaking other DeFi tokens. As of the 10th (local time), the cake token is trading at $23.52, according to Mesari.

Terra (Luna, LUNA) is evolving into a financial ecosystem that includes concepts such as stablecoins, synthetic assets, and savings accounts. Beyond a single protocol, Terra is transforming into a platform that provides as many things as possible.

Luna, the Terra blockchain governance token, is used to receive rewards when users use the protocol and to stake to verify blocks. Luna’s price rose 2785% this year alone. As of the 10th (local time), the price of Luna is $16.18%.

Both Pancake Swap and Terra are expanding their base amid a significant increase in fees on the Ethereum public blockchain, the foremost leader of the DeFi platform.

It means that users who feel burdened by the fees incurred by Ethereum are increasingly paying attention to DeFi projects created on other blockchains. Following Ethereum, Binance Smart Chain has become the most used smart contract platform for those who want to earn interest with DeFi, according to the Mesari report.

According to Cryptocurrency Media Decrypt, co-founder Matt Aaron of DeFi analysis company Uniwail also said, “The emergence of Pancake Swap is directly related to the high transaction fees of Ethereum.” “The ecosystem is well designed so that everyone flows into Luna tokens, and UI, UX, and incentives are all first class,” he said.

According to Mesari, there are many new and popular projects being developed in Terra, which has resulted in a surge in the interest rate of Terra stablecoins. Galaxy Digital, a cryptocurrency investment company, also invested 25 million dollars in Terra.

Ethereum is currently preparing the Ethereum 2.0 platform as part of solving the scalability and fee issues.

However, it is expected that it will be several years less for Ethereum 2.0 to operate stably in practice. Among these, Ethereum-based Layer 2 technologies are emerging one after another to solve the fee problem. In spite of the proliferation of Ethereum Layer 2 technologies, it is noteworthy whether DeFi projects outside of Ethereum will continue to take shape.