Anchor Protocol and Acala Integrating to Unite Terra and Polkadot DeFi Ecosystems
Following Acala’s announced plans to join Wormhole, Acala and Anchor Protocol will work together to serve as gateways into Polkadot and Terra, bringing increased liquidity and yield opportunities for aUSD and UST.
Acala is working with the team at Anchor, a savings and borrowing protocol built on the Terra blockchain, to grow the decentralized stablecoin space through a variety of integrations spanning the Terra and Polkadot ecosystems. Acala and Karura, Acala’s Kusama-based parachain, will initially help expand Anchor’s collateral options for the UST stablecoin with Liquid DOT (LDOT) and Liquid KSM (LKSM), Acala’s yield-bearing liquid staking derivatives.
The teams will also work together to stand up deep liquidity pools for aUSD and UST on Acala, serving as a gateway into the Polkadot ecosystem for UST users. The two teams will continue to build more integrations and deployments in the Acala and Terra ecosystems, using these initial integrations as a foundation.
Terra UST — Decentralized, censorship-resistant money for the internet
UST is a decentralized, algorithmic stablecoin built on the Terra blockchain. UST yield on Anchor Protocol is stable, powered primarily by staking returns from multiple proof-of-stake assets that users provide as collateral. Anchor offers low-volatility yields on Terra stablecoin deposits by lending to borrowers who deposit PoS assets as collateral and enjoy access to liquidity services via UST.
Polkadot and Kusama users will soon be able to access Anchor yield using their LKSM and LDOT. This will be done by first transferring their liquid staking assets to Terra via Wormhole, then providing their LDOT or LKSM as collateral to borrow UST on Anchor. By doing so, the user then earns ANC incentives for borrowing and is able to deposit their UST on the Earn side to earn 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.
ABOUT Anchor Protocol
Anchor is a decentralized borrowing and savings protocol offering users UST loans and low-volatile yield on stablecoin deposits. The Anchor savings rate is powered by a diversified stream of staking rewards from major proof-of-stake blockchains, which support its stability relative to the volatility of money market interest rates. The Anchor community believes that a reliable source of yield in Anchor has the opportunity to become the reference interest rate in crypto.
ABOUT Acala
Acala is a decentralized finance network powering the aUSD ecosystem. The core product, Acala USD, is a decentralized, multi-collateral, crypto-backed stablecoin serving as the native stablecoin of the Polkadot ecosystem. Acala’s Ethereum-compatible blockchain has built-in DeFi protocols for application developers to leverage, including a trustless staking derivative (liquid DOT — LDOT), a decentralized exchange, and the EVM+, a hybrid EVM offering fully Ethereum-compatible development environment plus full compatibility with Substrate.
RESOURCES
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