Join Delphi Research today and immediately get access to our full Member Portal!
Join Delphi Research today and immediately get access to our full Member Portal!

Anchor Deposits Cross $10B, L2 Stagnation, Ethereum Deployments Slow

Dec 22, 2021 · 3 min read

By Genevieve Yeoh, and Jimin Noh

Terra and Avalanche Adoption Boost Token Prices

  • Adoption of Terra and Avalanche has grown significantly throughout 2021, with the latter seeing a surge since its ecosystem incentives kicked off in September. Since Jul. 1, the number of addresses interacting with Avalanche increased by roughly 22x, while addresses using Terra grew by 22%. As a newer chain, Avalanche is bound to have a steeper growth curve, but that doesn’t diminish the tremendous growth the network has seen this year.
  • Market confidence has resulted in the price of L1 chains lingering around all-time highs as we head towards EOY. L1s have been the central narrative for the better part of this year. As the scaling wars heat up, it doesn’t seem like this trend will end anytime soon.
Anchor Hits $10B in Deposits
  • Anchor Protocol hit over $10B in deposits — a result of LUNA’s price hitting all-time highs. Further catalyzing this was the integration of Terra’s stablecoin, UST, into Abracadabra. Recent MIM replenishes on Abracadabra Money fueled deposits into Anchor.
  • Abracadabra Money now has over $1B in UST deposits in its “Degenbox” strategy. The strategy deposits 85% of UST from each user into Anchor Protocol to enhance depositor yields. Almost $400M MIM was minted yesterday via Abracadabra’s UST cauldron in just 8 hours.
Less Deployments on Ethereum?
  • Smart contracts deployed on Ethereum took a hit in Jun. 2021, and while there are still over 250K contracts deployed each month, this number is far from where it was in H1 2021.
  • The rising costs of deploying contracts has likely played a key role in pushing developers to alternatives networks. Whether this can eventually pick up on Ethereum-centric L2s remains to be seen.
L2 TVL Declines as L1s Steal the Show
  • L2’s are losing market share to L1’s in recent months, despite the migration of DeFi protocols from Ethereum. Most expected L2s to immediately become a hot-spot for developers and users who were priced out of Ethereum mainnet. But to the detriment of Ethereum, other L1s stole the limelight. Ecosystems like Polygon and Avalanche that dedicated a portion of their token treasuries to user incentives were key to making this happen.
  • Notable TVL deterrents include absent L2 native tokens, increasing gas costs on mainnet Ethereum, and reduced farming emissions.
Notable Tweets

A market update from QCP Capital

An interesting trend on BTC

APWine hits mainnet tomorrow!

Delphi’s Kevin Kelly highlights key crypto trends for 2022

Join Delphi Research today and immediately get access to our full Member Portal!

Join Now  or  Sign in