DYAD, an Ethereum-based Stablecoin Protocol, Sees Its TVL Explode Over 950% in a Month

DYAD, a decentralized stablecoin protocol launched more than a year ago, saw its total value locked (TVL) explode over 950% over the past month.

Decentralized stablecoin protocol DYAD, which was launched over a year ago, has seen its total value locked (TVL) explode by over 950% in the past month.

On August 5, it had $3.3 million locked in its pools. Today, its TVL has surged to a record $35 million.

DYAD is an Ethereum-based stablecoin platform that uses a Maker-like collateralized debt position (CDP) model. It allows users to deposit tokens like Wrapped Ethereum (WETH), Wrapped stETH (wstETH), and more to mint DYAD, a stablecoin pegged to the value of the US dollar.

As a rule, the value of the collateral should be at least 150% of the minted stablecoins. However, this ratio can be reduced to 100% by staking the native token, Kerosene (KERO).

Investor interest in the stablecoin has surged in recent weeks, likely due to the generous yields that DYAD offers. After minting DYAD, users can then provide liquidity to the USDC/DYAD pair on Uniswap v3, which is currently offering an annual percentage rate (APR) of over 45%. The rewards are paid out in KERO.

DYAD’s token inflows began to explode at the end of August, hitting a record $8.43 million on August 29.

Out of all the tokens, WETH has become the most deposited, hitting a record daily inflow of $6.7 million on August 29. It overtook wstETH at the end of August and now accounts for over 53% of the token value deposited on the platform.

Since Kerosene is required to mint DYAD and reduce the collateral ratio, its price has also been driven up by the surge in DYAD liquidity.

CoinGecko data shows that the price of KERO has increased by about 1,000% within a few weeks – rising from $0.019 on August 5 to a record $0.35 on August 30.

The increase in DYAD’s TVL comes as the broader decentralized finance (DeFi) market is struggling at the beginning of September.

All of the top 40 DeFi protocols have experienced a decline in TVL, except for Binance staked ETH, which added 0.4%.