Binance Smart Chain (BSC) quickly rose to prominence in 2021, as high transaction costs and congestion on the Ethereum (ETH) network led smaller investors to seek cheaper alternatives.
One of the best choices for earning a yield on BSC is Venus (XVS), an algorithmic money market and synthetic stablecoin protocol that provides a lending and borrowing solution for the decentralized finance (DeFi) ecosystem. .
Data from TUSEN Markets and TradingView shows the price of Venus catapulted 3000% in the first two months of the year, from a low of $ 3.20 on January 1 to an all-time high of $ 103 on the 19th. February before correcting to $ 35. March 25. At the time of writing this article, the price of the XVS is trading at $ 98.
Traders are looking for a stable return with less risk
When comparing different protocols on blockchain networks, Venus’ main competitor on the Ethereum network is Maker (MKR) and its DAI stablecoin. In addition to being able to deposit collateral to earn a return, users can also borrow against their collateral by striking the VAI stablecoin, a synthetic BEP-20 token that is pegged to the value of a US dollar.
Users who prefer to hold a significant portion of their wallet in a stablecoin can purchase VAI and deposit it in the Venus Vault for a yield of 19.91% at the time of writing.
Those who want to get more involved in the community can purchase the XVS token, which is the governance token for the Venus protocol and allows token holders to vote on changes to the ecosystem, such as the addition of new types. guarantees or the organization of product improvements.
The list of tokens supported by the protocol continues to grow, with many of the best tokens already available for users to earn a return. Currently supported coins include Ethereum, Binance Coin (BNB), Litecoin (LTC), Chainlink (LINK), Polkadot (DOT), XRP, and Cardano (ADA).
The returns offered by the protocol are on average between 4% and 10%, the gains being paid in the same form as the staked collateral. While the amount earned on Venus is lower than many Yield Farming options, users don’t have to worry about impermanent losses or the value of the Protocol Token dropping and wiping out their wins.
Defistation data shows that Venus is currently the highest ranked DeFi platform on the BSC in total locked-in value, with $ 7.8 billion in collateral currently deposited on the protocol.
Compared to DeFi platforms on all blockchain networks, Venus ranks eighth behind its main competitor Ethereum Curve, which currently has $ 6.47 billion in TVL.
The flow of institutional and retail investors into the cryptocurrency ecosystem has accelerated in 2021 and this trend is expected to continue for the foreseeable future.
Despite Berlin’s upgrade this week to the Ethereum network, the fees are still high and that leaves the door open for competing chains and protocols looking to expand their user base.
Venus is well positioned for further growth as people increasingly shy away from the old financial system in search of higher returns and effortless capital mobility.
The opinions and opinions expressed here are solely those of the author and do not necessarily reflect the views of TUSEN.com. Every investment and trading move comes with risk, you should do your own research when making a decision.