Cross-chain protocol TVL is up 60% in one week
Stargate Finance got off to an eventful start.
The cross-chain protocol held an auction for its STG token on March 17, only to have trading firm Alameda Research buy all 100 million of it in the very first block, then-CEO Sam Trabucco confirmed.
This prompted the project to launch another sale of 20 million STG on March 30 to distribute the token to the wider community.
A day after the second auction, the token surged to an all-time high of $4.14 on April 1, but a month later it was trading at $0.95. STG slowly shrank to an all-time low of $0.33 on Aug. 18.
Then, after the news that Binance, the world’s largest crypto exchange, would list STG on August 18, the token surged to $0.95 and nearly tripled in 24 hours. The momentum has continued since then and STG is trading at around $1.06 at the time of writing.
TVL increased by 60%
And it’s not just the price action — the total value locked (TVL) is up over 60% over the past week, according to data from DeFi Llama.
As a bridge protocol that transfers assets across blockchains, Stargate allows users to deposit their assets into liquidity pools and earn fees when other users and apps initiate transactions that move assets between blockchains.
Liquidity Providers (LPs) are rewarded with STG tokens when they add LP tokens to any of what Stargate refers to as “farms”. Given that TVL’s rise coincided with STG’s rally, it is likely that the protocol will attract more LPs as yield increases with STG’s price.
At $679 million, Stargate is still about 84% down from its all-time high of $4.17 billion in TVL, hit on April 5, four days after STG hit its all-time high.
Other well-known cross-chain protocols such as Hop Protocol and Synapse have also seen their TVL drop precipitously as the bear market hit this year.
Volume on Stargate has slowed over the year, but daily transactions have picked up over the past month, according to stgscan.io.
FTX listing
Now, crypto exchange FTX has announced that it will launch perpetual futures or “perps” for STG on August 26 at 2pm UTC.
Perpetual futures are derivatives, similar to futures, that allow a trader to take an indefinite long or short position on a token. When a centralized exchange like FTX lists perpetuals for a token, it becomes much easier for traders to short it.
This trend was not forgotten on Twitter as observers joked that the listing will send the token to zero.
However, not everyone thinks the announcement is bearish. Crypto influencer Chubbicorn219 underscored how LDO, the governance token of liquid staking protocol Lido Finance, is actually up 33% since FTX listed LDO Perpetuals on July 19.
LDO Price, Source: The Defiant Terminal
As a cross-chain liquidity protocol, Stargate enables the movement of assets across blockchains in a single transaction. The protocol’s CEO, Primo, sees Stargate not as a user-centric product, but rather as a piece of core infrastructure for protocols.
“Stargate’s true form is NOT to be a user bridge, but to [be] the liquidity transfer layer between applications and leverage its composability to increase this process up to 10x for all applications that want to go cross/omni-chain,” Primo wrote on the Stargate forums.
Decentralized Exchange (DEX) Sushiswap has already launched SushiXSwap, which facilitates cross-chain trading and is built on top of Stargate. PancakeSwap, the leading DEX on Binance Smart Chain, also launched a cross-chain bridge with Stargate this week.
RayJ, an STG holder who frequents the Stargate Discord, told The Defiant that Stargate will integrate Aptos, a Layer 1 blockchain that announced a $150 million Series A last month.
Aptos has yet to launch its mainnet, which is expected to come with token incentives. “There’s going to be a lot of new DeFi that people are going to grow the hell out of,” he said. Stargate will aim to collect fees from users bridging to Aptos from other chains.
With a listing imminent and integrations by notable DeFi players happening at a decent pace, Stargate appears to be a bright spot in the bear market.
CORRECTED August 26th at 1230 ET to show Stargate plans to integrate Aptos.
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