Stargate Finance (STG-USD) has not wasted any time since its launch, becoming one of the fastest growing cryptos right now. The protocol promises to eliminate many of the issues that plague blockchain bridging — a practice that is becoming more ubiquitous as more users and tokens crop up across blockchain networks. Investors and venture capitalists alike are taking notice of Stargate’s earth-moving technology; the result is nearly $2 billion flowing into the protocol, just days after launch. The immediate success of the project is stirring up much chatter about the STG crypto today.
Stargate first appeared in October in a blog discussing the “bridge trilemma,” and proposing its technology as a solution to it. Bridges are a blockchain technology investors use to move native funds on one chain to another chain, and vice versa. The technology is becoming more needed as more crypto projects crop up on different chains; users want to consolidate their assets on a single chain, and bridges are the way to do that.
Co-founder Ryan Zarick explains in the post that bridge developers seek out three features. The first of these, instant guaranteed finality, ensures bridge users that funds on the destination chain are present when a transaction is committed on the source chain. The second, unified liquidity, ensures shared access of a given liquidity pool between chains. The third, native assets, refers to the user-desired assets on the destination chain. Zarick posits that developers are most often restricted to just one or two of these features, while all three are needed.
STG Crypto Pops as Stargate Presents Solution to Bridging Drawbacks
Stargate Finance seeks to solve this “bridge trilemma” with its own protocol. Indeed, it promises it can provide all three integral functions of a perfect bridge. Oftentimes, bridges require users to lock assets, swap for synthetic versions of tokens and then redeem the real asset on the destination chain. Stargate promises a protocol that allows one to bridge assets across seven of the industry’s largest chains in a single simple transaction. Developers demonstrated the capabilities of Stargate and the STG crypto in a second blog post.
Users have been very excited about the project. Stargate allows a user to make transactions more convenient and much faster. Moreover, the network removes many of the gas fees associated with bridging elsewhere. And as the project begins its second week, the STG crypto is seeing a great benefit.
Stargate began its token auction on March 17, selling a total of 100 million STG tokens. The auction sold out nearly instantaneously. In fact, developers ended up reapportioning tokens to users who missed out on the event. This is because the project has also succeeded in attracting attention from VC firms; crypto investing outfit Alameda Research bought up all of the available tokens on the auction.
This event speaks to the sheer hype of the project, but perhaps even more representative of the success is the $1.9 billion in total value locked (TVL). In just six days, the project has grown to become one of the largest DeFi protocols in the world by TVL.
Accordingly, the STG crypto is booming on this instant popularity. Today, the token is gaining over 36%. Similarly, transaction volume is booming, with the amount of STG swapping hands today rising 20% over yesterday’s volume.
On the date of publication, Brenden Rearick did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
