Up and Coming SoLuna (Terra Chain)
One of the most increase TVL in the past week on Terra is a protocol that is called SoLuna. A double in TVL in the past week to close to $23 million, what is this protocol Soluna?
SoLuna Leveraging Anchor and Solana
Over on DefiLama the protocol SoLuna is described as a protocol using Anchor to earn while bridging over to Solana.
The protocol allows users to sake solUST that is supposely the same interest bearing token like aUST. In addition for staking solUST investors also earn governance token SLNA. So the total APY % is around 55% at current status.
In order to get SolUST investors need to deposit their UST on Terra chain into SoLuna protocol. In return the protocol will mint SolUST at a 1 : 1 rate for every UST. After that the SolUST can be used to be staked to earn governance token SLNA or it can be provided in liquidity pool on Saber to earn yield.
This approach is trying to simplify a bridge for users to get on Solana with the use of Terra's UST. To learn more you can follow the protocol's official twitter account for updates when they arrive:
https://twitter.com/solunaDAO
Conclusions
Some concerning points I like to point out, during my review of the website there was no mention that Terra chain projects or protocols have any association or support for SoLuna. In addition there is no audits on the platform. This maybe tempting to earn more yield but becareful and use at your own risk. The yield will be rewarded in SolUST not Terra's UST.
The APY is slightly higher than that on Anchor and not matching so not sure why that could be the case. Overall I am only looking into this protocol due in part of its activity on Terra chain and how it has grown over the past week. Since it is new maybe all the info has not come to light yet, but I would prefer to wait and see how this platform performs a few weeks/months before trying to invest in.
None of what I write is financial advice. It is for entertainment purposes only. Thanks for reading!
