Acala, Anchor Join Forces to Unite Terra and Polkadot DeFi Ecosystems
Acala, the Ethereum-compatible DeFi protocol has announced teaming up with Anchor to boost the decentralized stablecoin space of Terra and Polkadot ecosystems.
Following Wormhole integration plans, the two parties are all set to bring increased liquidity and yield opportunities for aUSD and UST by serving as gateways into the decentralized finance ecosystems of Polkadot and Terra.
Acana-Anchor Network Collaboration
Initially, Acala and its Kusama-based parachain – Karura will be tasked with aiding the expansion of Ancho’s collateral options for the UST stablecoin with Liquid DOT (LDOT) and Acala’s yield-bearing liquid staking derivatives – Liquid KSM (LKSM).
According to the press release shared with CryptoPotato, the entities will focus on working together to “stand up” deep liquidity pools for aUSD and UST on Acala. This is expected to act as a gateway into the Polkadot ecosystem for UST users. The duo will also work on forging more integrations and deployments in both Acala and Terra ecosystems.
Additionally, users of Polkadot and Kusama networks will be enabled access to Anchor yield with the help of their LKSM and LDOT. The first step towards achieving this is by transferring their liquid staking assets to Terra through the cross-chain bridging platform – Wormhole. Then, users’ LDOT or LKSM can be provided as collateral to borrow UST on Anchor. The release stated,
“By doing so, the user then earns ANC incentives for borrowing and can deposit their UST on the Earn side to earn a stable yield. With this new use case for LDOT and LKSM, a whole new group of users from Dotsama (Polkadot and Kusama) will be introduced to the Terra ecosystem.”
Moving forward, Acala and Anchor plan to create UST/aUSD pools to enhance the liquidity for aUSD and UST. Initially, the pools will be developed on Acala before its expansion across multiple parachains and layer 1s. The focus will also be to grow the decentralized stablecoin space together.
$250 Million Acala Ecosystem Fund
As reported by CryptoPotato, Acala announced the launch of a $250 million aUSD Ecosystem Fund last month. The main aim is to support new startups dedicated to building apps with use cases for Acala’s stablecoin on any Polkadot or Kusama parachain.
The focus is also on the expansion of both the ecosystems via increased cross-chain activity and growth of aUSD. The fund was launched in collaboration with eight Polkadot parachain teams and numerous supporting venture funds.
OhNoRipple via https://www.ohnocrypto.com/ @Chayanika Deka, @Khareem Sudlow