BENQI, an Avalanche-based lending protocol hits the $1 billion TVL milestone a few days after the launch.
BENQI Hits $1 Billion in TVL
BENQI, an algorithmic liquidity market protocol powered by Avalanche’s highly scalable network recently recorded more than $1 billion in total value locked (TVL) on its decentralized platform since its launch on August 19.
For comparison, it took Ethereum-based decentralized lending platform Aave (AAVE) about 8 months to hit $1 billion in TVL.
BENQI’s achievement comes shortly after the platform announced a partnership with the Avalanche Foundation and launched a joint liquidity mining program to commemorate both the launch of the BENQI protocol and the high traction of growth witnessed by the DeFi space within the Avalanche ecosystem.
Notably, $3 million worth of AVAX will be allocated as liquidity incentives for BENQI users with plans to integrate additional incentives in the pipeline. The AVAX rewards will be distributed to users who lend or borrow AVAX, ETH, LINK, wBTC, USDT, and DAI on the BENQI protocol.
For the uninitiated, AVAX is Avalanche’s native token with a fixed maximum supply and is used to pay fees and secure the Avalanche network via staking. In addition, AVAX can also be used as a basic unit of account between the multiple different ecosystems thriving on Avalanche.
It is worthy of note that BENQI recently concluded a $6 million funding round backed by the Avalanche Foundation, Mechanism Capital, Dragonfly Capital, Arrington XRP Capital, and the Spartan Group.
The protocol’s next set of missions includes expanding upon a wide range of high-performance financial primitives including money markets.
BENQI aims to tap the plethora of benefits of the quick, secure, and cost-efficient Avalanche Bridge which has effectively minimized the distance between the Avalanche and Ethereum ecosystems. The Avalanche Bridge leverages Intel SGX and makes the process of transferring digital assets to and from the Avalanche and Ethereum ecosystems a seamless experience.
Commenting on the development, JD Gagnon, Co-Founder of BENQI, noted:
“This has been an incredible week for the team and we are overwhelmed by the amount of support our partners and the Avalanche community has shown us leading up to this. 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.”
Similar sentiments were echoed by John Wu, President of Ava Labs. Wu said:
“BENQI is launching at a key moment for Avalanche users and the broader DeFi ecosystem. Its technology adds a missing piece to the puzzle, and will make Avalanche even more attractive to users being priced out of other networks. This is an exciting step in a broader community initiative to bring more assets and liquidity onto the platform.”