BENQI is a liquidity market protocol. It has recently reached a total locked value (TVL) of $1 billion in less than a week after its launch on the Avalanche Network (AVAX). This was an important milestone heralding the explosive growth of decentralized finance (DeFi) lending services. Benqi Finance announced the event on Twitter Sunday evening, where it thanked the community for their unconditional support.
According to the update on August 21, the protocol brought in $200 million to TVL in the first 24 hours and then $500 million in the next two days. In decentralized finance, TVL or total locked value refers to all the assets that are at present being staked on a specific protocol. This figure however does not show the outstanding loans. It shows the total supply guaranteed by a particular application. Industry-wide TVL data shows a significant growth in DeFi activity. There are approximately $ 160 billion of TVL registered in the DeFi ecosystem at the time of writing. Aave is the largest player in the market, accounting for 8.82% of TVL. Interestingly, in a few months after its launch, Aave hit the billion-dollar mark in the form of TVL.
BENQI And Avalanche
Avalanche smart contract platform has seen a lot of activity lately. Pangolin, yet another DeFi protocol has been focusing on decentralized exchange services and it has reached over $320 million in TVL. Avalanche is contributing to bringing more developers to its platform. It has recently announced a $180 million liquidity mining incentive program.
Avalanche calls this program as Avalanche Rush. It is encouraging the migration of more apps and tokens to the Avalanche platform. J.D. Gagnon is the co-founder of BENQI. Media asked him that what makes Avalanche such an amazing platform for developers. To this, he said that it has a lot to do with optimizing the experience for both users and developers:
“Firstly, Avalanche, the C-chain (the smart contract chain) in particular, is a wonderful ecosystem to experience, both as a user and as a builder. The fast finality, low fees, and security guarantees make it 10x better than many other networks. Many users have been excluded from participating in the DeFi boom on Ethereum due to high transaction costs, an issue that is largely resolved on Avalanche.”
In terms of DeFi growth, Gagnon said that the growth of BSC or Binance Smart Chain and Polygon “have shown there is a significant appetite for cheap, efficient and secure networks for economic activity”. Moreover, Gagnon expects that Avalanche will be the main source of this growth in the future.