Blockchain market data provider CryptoCompare is revealing the most potent threat to Ethereum (ETH) in the decentralized finance landscape during the first quarter (Q1) of 2022.
In a new report, CryptoCompare says that Ethereum is experiencing stagnant growth in the total value locked (TVL) – the amount of all staked crypto assets that are generating interest and other rewards.
The crypto market data provider says that the fierce competition from Ethereum’s rivals is one of the reasons behind the stagnant growth of the second-largest digital asset by market cap.
“Ethereum has maintained dominance (now at 55.6%), despite stagnant growth with a current TVL of $150 billion (down 20.8% from the end of 2021, Q4). This stagnation can be attributed in part to the weak performance of crypto assets during the quarter, but also to the fierce competition among alternative layer1 protocols.”
CryptoCompare says that Terra (LUNA), a blockchain protocol that’s mainly focused on hosting algorithmic stablecoins, was the most successful in taking on Ethereum in 2022, Q1.
“Terra, for example, has proven the most successful challenge to Ethereum over the last three months, with a quarter-over-quarter TVL growth of more than 72.0% to $35.2bn, continuing the Solunavax narrative from 2021.”
Solunavax is the acronym for the trio of the leading Ethereum competitors – Solana (SOL), LUNA and Avalanche (AVAX).
According to the cryptocurrency market data provider, the growth in Terra’s TVL is attributable to the attractive yields on its fixed yield platform, Anchor Protocol.
Staking Terra’s flagship stablecoin UST on Anchor Protocol currently generates an annual percentage yield of 19.46%.
Terra, ranked eighth by market cap, is trading at $98.39 at time of writing.