Terra TVL has reached its lowest point in 2022. more than $14 billion crashed


Terra Total Value peg (TVL) plunged sharply in the second week of May due to the overall bearish market, reducing investor interest in DeFi across several chains.

After Ethereum, Terra emerged as the second blockchain with the most TVL in March and April.

According to Be[In]According to crypto research, Terra has lost 78% of its total locked value since January 1, 2022. As of January 1st, Terra’s TVL was approximately $18.4 billion, down to approximately $4.02 billion on May 11, 2022.

Source: Terra TVL by DeFiLlama

Terra is a protocol that deploys a suite of algorithmically decentralized stablecoins that support a thriving ecosystem that brings DeFi to millions of people. As one of the leading cross-chain protocols in crypto finance, it maintains a growing ecosystem of over 100 projects in the Web3 and DeFi arena.

Why is TVL declining?

Many believe that Terra TVL crashed this week as dApps in the ecosystem fell to new lows.

Decentralized lending and borrowing platform Anchor, for example, is down more than 80% over the past month, while staking platform Lido is also down more than 98% in TVL over the same period.

Automated DEX protocols Astroport and TerraSwap lost more than 90% and 80% of their total locked value respectively.

Others that contributed to the plunge in locked total value include, but are not limited to, Mirror, Pylon Protocol, Mars Protocol, Risk Harbor, Spectrum Protocol, Aperture Finance, Stader, Loop Finance, and PRISM Protocol.

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Source: Terra TVL by DeFiLlama

Thanks to the aforementioned dApps, Terra lost more than $14 billion, followed by Binance Smart Chain, Avalanche, Solana, and TRON.

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Source: All Chains TVL by DeFiLlama

That said, despite the weakening TVL, Terra still holds the largest share of the values ​​pegged to Polygon Fantom, Waves, Near and Cronos.

Luna price reaction

LUNA will open in 2022 with a transaction price of $85.51. The coin reached an annual high of $119.18 on April 5 and was trading hands at $1.06 at the time of writing.

Overall, this equates to a 98% drop in LUNA prices since early 2022. On Thursday, Terra Chain announced that it had resumed operations after halting block production for two hours.

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Source: LUNA/USD chart on TradingView

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