Avalanche lending protocol BENQI hits $1 billion in total value locked(TVL) just a few days after it went live.
It’s worth noting that it took DeFi lending platform Aave (AAVE) 8 months to reach the billion-dollar mark.
As explained by its creators, BENQI is an algorithmic liquidity market protocol.This Decentralized Platform has attracted $1B since its launch on August 19, 2021.
This development came shortly after a collaboration was announced with the Avalanche Foundation.
BENQI and the Avalanche Foundation will take part in a joint liquidity mining program to celebrate the launch of the BENQI protocol.
They’re both looking forward to the next phase of growth within Avalanche’s decentralized finance ecosystem.
As mentioned in the announcement, $3 million in AVAX tokens will be set aside as liquidity incentives for BENQI users. Along with various other incentive programs to be announced soon.
The AVAX token will be given as a reward to users who are lending and borrowing various DeFi tokens. The rewards invclude AVAX, ETH, LINK, wBTC, USDT, and DAI on the protocol with BENQI.
AVAX is the native token of Avalanche.
It’s a “hard-capped” and “scarce” asset that’s used to cover platform usage fees, secure the platform via staking, and offer a unit of account between the different subnets launched on Avalanche.
BENQI Has Acquired Substantial Funding
BENQI recently finalized a $6 million investment round that’s reportedly backed by the Avalanche Foundation, Mechanism Capital, Dragonfly Capital, Arrington XRP Capital, and the Spartan Group.
The next phase will mainly focus on expanding upon high-performance financial primitives, such as money markets.
With the introduction of the Avalanche Bridge, a secure bridging architecture that uses Intel SGX to enable fast, secure, and cheap asset transfers between the Avalanche and Ethereum blockchains, BENQI and other select initiatives are expected to lead the charge, with various other dApps set to go live on Avalanche.
JD Gagnon, Co-Founder at BENQI, said that this has been a great week for the team and they’re quite pleased with the amount of supporting their partners and the Avalanche community have shown them leading up to this milestone.
Gagnon added: “The Avalanche Rush initiative coupled with the new Avalanche Bridge has proved to be a major catalyst for the rush of liquidity to not only BENQI, but the rest of the Avalanche DeFi ecosystem.
A big thank you to everyone involved! We’re currently optimizing the protocol, and have plans to collaborate with projects going cross-chain to Avalanche as part of the Avalanche Rush initiative.”
Avalanche Is Attractive to Users Being “Priced Out” of Other Networks
John Wu, President of Ava Labs, a team supporting development on Avalanche, noted that BENQI has been introduced at a pivotal moment for Avalanche users and the wider DeFi space.
Wu also mentioned that its technology “adds a missing piece to the puzzle, and will make Avalanche even more attractive to users being priced out of other networks.”
He further noted that this is “an exciting step in a broader community initiative to bring more assets and liquidity onto the platform.”
As explained by its developers, BENQI has been implemented on Avalanche’s “highly scalable” network. It aims to bridge DeFi and institutional networks, starting with the launch of BENQI on the Avalanche C-Chain.
Through BENQI, Avalanche users will get a chance to generate substantial interest on their assets, acquire credit via over-collateralized loans and be able to earn QI governance tokens as rewards for offering liquidity on the protocol and Pangolin.
Notably, Avalanche has become one of the most widely-used open-source platforms for building decentralized applications and enterprise blockchain deployments through an interoperable and scalable ecosystem.
Avalanche is a decentralized, smart contracts-enabled platform built specifically for the scale of global finance, with “near-instant” transaction finality. Ethereum developers are able to deploy solutions on Avalanche as Solidity works “out-of-the-box.”
New Avalanche Bridge Offering Improved UX
Recently, the new Avalanche Bridge was unveiled. It offers an improved user experience when compared to previous versions and effectively replaces the Avalanche-Ethereum Bridge that was introduced in February of this year.
The Avalanche Bridge is around 5x cheaper than the older Avalanche-Ethereum Bridge.
It has been implemented using Intel SGX Enclave technology, which is considered a significant breakthrough in secure computing that aims to support all operations in a closed, tamper-proof environment.
The Avalanche Bridge has been developed with a number of factors in mind, such as enhanced audit capability, security, affordable costs, fast transaction times, the option for users to view transaction status whenever they want, multi-chain functionality, among several other features.
Emin Gün Sirer, Founder and CEO of Ava Labs, has stated:
“The new Avalanche Bridge is a leap forward in bridging technology, but most importantly, it is a dramatic improvement in experience for users and developers across the Avalanche community.
It will be a growth engine for the next phase of growth on Avalanche, and set a new standard for secure and efficient cross-chain interoperability.”