All eyes are on the decentralized finance industry these days. Even in a bear market, ecosystems like Terra note a solid 88% TVL increase in the past month. Unfortunately, for Polkadot and Moonbeam, things head in the opposite direction.
Polkadot Loses 78% DeFi TVL
It is interesting to see how the so-called “next-generation” blockchain ecosystems fall short in the DeFi department. More specifically, Polkadot is a very powerful infrastructure. Its use of parachains to process transactions in parallel and on the chain belonging to a particular project is appealing. One would think developers bring DeFi solutions to this ecosystem ahead of parachains launching.
So far, that has not happened yet. Most of the DeFi development takes place on Moonbeam, the smart contract platform for Polkadot development. It is logical, as every project and protocol requires thorough testing before going live. One project is classified as a decentralized finance protocol on Polkadot: Stafi. Unfortunately, that project lost roughly 78% of its Total Value Locked in the past month. As such, Polkadot’s DeFi TVL decreased by the same percentage.
It is worth noting Stafi is not a native Polkadot-based protocol. Instead, it is a multi-chain solution on Ethereum, Polkadot, Solana, Polygon, Cosmos, BNB Chain, and Kusama. Its overall TVL looks rather break, although most of it still resides on Ethereum. Polkadot is now the four-least liquid network for this protocol.
Moonbeam Isn’t Doing Much Better
Even though most of DeFi development for Polkadot occurs on Moonbeam, that network isn’t doing too well either. Several projects lost over 15% in TVL this past week. Some of that is due to the bearish market trend affecting all crypto assets. However, it appears people purposefully move funds out of these protocols lately, which is rather problematic.
The big dippers this week are ThorusFi (-54.11%), Convergence (-28.08%), BeamSwap (-26.56%), Solarflare (-22.74%), and Demodyfi (-17.23%). A rather bleak performance across all of these protocols, although things can turn around at any given moment. For now, Moonbeam has just under $140 million in Total Value Locked, which is still somewhat decent.
On the upside, CougarSwap gained over 4,000% in liquidity. Polkamarkets, StellaSwap, and Beefy Finance all gained over 24% in the past week as well. Those are solid developments, yet only one of those protocols has over $2 million in TVL today. There is still much work to do for Moonbeam – and Polkadot – to become a bigger player in this industry vertical.
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