USDa, a Bitcoin-backed stablecoin, has emerged as the second-largest collateralized debt position (CDP) project globally, boasting a total market size of $84.10 million.
According to Avalon Labs, USDa’s market size comprises $68.10 million in supplied assets and $20.85 million in borrowed assets. Launched on November 11, USDa is the first overcollateralized stablecoin pegged to Bitcoin, utilizing BTC as collateral and operating on LayerZero’s cross-chain technology. Dubbed “Bitcoin Money,” it bridges institutional liquidity across both permissioned and permissionless environments, integrating seamlessly with DeFi and CeFi ecosystems.
Key Metrics and Growth
USDa’s total value locked (TVL) across BNB Chain, Ethereum, and Mantle stands at $483 million, marking a 0.65% growth over the past 30 days. The stablecoin currently holds $63.25 million in liquidity and offers an APY borrow rate of approximately 1.37%, supported by 95 total holders. Its innovative liquidity reward systems, including an 8% fixed borrow rate for BTC-backed loans, have positioned USDa as a competitive force in the decentralized financial (DeFi) lending space.
Comparisons and Competition
While USDa has made significant strides, MakerDAO remains the dominant player in the CDP market with a $4.576 billion market cap and over 4.576 billion DAI in circulation. MakerDAO’s reliance on Ethereum-based collateral has helped maintain its leading position in the DeFi ecosystem. For comparison, USDa’s market cap is $235.74 million with a circulating supply of 235.5 million, according to DeFiLlama data.
The Broader DeFi Lending Ecosystem
DeFi lending, a decentralized counterpart to traditional banking, enables users to borrow and lend digital assets by pledging crypto as collateral. This self-contained financial system is largely unconnected to traditional economic infrastructure. In 2022, the DeFi lending protocol market was valued at $13.61 billion, with approximately $25 billion in debt outstanding, according to the Bank of International Settlements. The global stablecoin DeFi market is projected to grow at a compound annual growth rate (CAGR) of 46% over the next six years.
USDa’s rapid rise and unique features suggest it could continue to gain traction, positioning itself as a formidable player in the evolving CDP and DeFi lending landscapes.
