Anchor Protocol is a lending and borrowing protocol offering up to 19.5% yield on stablecoin deposits. Lenders can deposit their UST and earn attractive rates on their investments while simultaneously benefiting from low volatility. Borrowers can turn their LUNA collateral into productive assets without giving up control of it.
Anchor Protocol can thus attract risk-averse investors looking for high-yield, low-volatility investments and increase demand for UST. This advances the adoption of UST as a stablecoin and subsequently the adoption of the Terra project in DeFi. With the increasing adoption of Terra, whose founders are behind the launch of Anchor Protocol, the price of LUNA will increase.
## Who Are the Founders of Anchor Protocol?
Anchor Protocol was founded in March 2021 by Terraform Labs, a South Korean fintech company founded by Daniel Shin and Do Kwon. Terraform Labs is also behind the Terra layer-one blockchain that has taken the DeFi space by storm, rising by 17,000% in 2021.
Before launching Terraform Labs, Mr. Kwon was CEO of Anyfi, a startup providing decentralized wireless mesh networking solutions. Moreover, he previously worked as a software engineer for Microsoft and Apple. Mr. Shin co-founded and headed Ticket Monster, a major South Korean e-commerce platform. He also co-founded Fast Track Asia, a startup incubator that helps entrepreneurs build fully functional companies.
Terraform Labs is one of the biggest and most in-demand companies in the cryptocurrency space and has raised $150m from major crypto investors like Arrington XRP Capital, Pantera Capital, Galaxy Digital, and BlockTower Capital.
## What Makes Anchor Protocol Unique?
Anchor stands out from countless other money market protocols like Aave and Compound thanks to its **elegant user interface and simple-to-use functionality**. The protocol’s core value proposition is connecting borrowers and lenders by offering the former a way to borrow in stablecoin without forfeiting their investments and the latter an attractive interest rate on stable assets.
**Lenders** connect their Terra Station wallet and deposit UST by paying a 1.60 UST transaction fee and earn the protocol’s 19.5% annual interest rate on a pro-rata basis for every block transaction (every eight seconds).
**Borrowers **bond their LUNA tokens and receive bLUNA (bonded LUNA) in return. They can borrow up to 60% of their deposited collateral in UST and pay an interest rate that is slightly higher than that paid to lenders. Bonded LUNA can be unbonded after 21 days. However, they also receive ANC tokens distributed by the protocol to incentivize its adoption.
The protocol uses revenue from the spread between borrowers’ and lenders’ interest rates to earn staking rewards on Terra, which are between 5% and 7% annually. The **Anchor Yield Reserve** is the protocol’s treasury that covers its expenses when rates have not reached a stable equilibrium. For instance, during the summer 2021 crypto market correction, Terraform Labs injected 70 million UST into Anchor’s Yield Reserve to ensure protocol stability.
## Related Pages:
Check out Astroport (ASTRO) — a decentralized exchange on Terra.
Check out Mirror (MIR) — a synthetic asset protocol on Terra.
Learn about what Crypto Lending is.
Get the latest crypto news and latest trading insights with the CoinMarketCap blog.
## How Many Anchor Protocol (ANC) Coins Are There in Circulation?
ANC is the protocol’s native governance token that can be staked to receive voting rights and influence Anchor's future. Its total supply is 1 billion, with a current circulating supply of 222 million. The ANC token is distributed as follows:
* Borrower incentives (40%)
* Investors (20%)
* Team (10%)
* Luna staking rewards (10%)
* Community fund (10%)
* ANC liquidity (5%)
* Airdrops (5%)
Anchor does not offer any information about vesting schedules. The ANC token reached an all-time high of over $8 shortly after its launch, but has significantly lost in value since. However, if UST supply continues to expand, ANC could potentially revisit its trading range between $3 and $4.
## How Is the Anchor Protocol Network Secured?
Anchor is built on the Terra blockchain, a layer-1 blockchain using a delegated proof-of-stake consensus mechanism based on Tendermint. LUNA token holders can either stake tokens themselves to secure the network or delegate their tokens to other validators.
Anchor has also been audited a total of three times by Cryptonics and Solidified and found to be secure. The protocol offers a Bug Bounty Program with rewards between $500 and $150,000.
The ANC token is available as a native CW-20 token on Terra and as an ERC-20 token on Ethereum.
## Where Can You Buy Anchor Protocol (ANC)?
ANC is available on Binance, OKX, Mandala Exchange, KuCoin, and Gate.io.
If you want to learn more about how to start buying cryptocurrencies, you can read more on CoinMarketCap Alexandria.
How to Buy ANC on an Exchange
Step 1: Choose a Reputable Exchange Platform
Select a trusted platform from among many available options for purchasing ANC. Some reputable platforms include Gate.io、MEXC、Bitget, and others.
Step 2: Register an Account
Here, we'll register an account on theGate.io(registration link) trading platform. You may need to provide personal information such as phone number and email to complete the registration process.
Step 3: Complete Identity Verification
For security purposes, some platforms may require you to complete identity verification. Follow the platform's instructions to provide necessary identity information (such as country/ID number) and undergo facial recognition. Once your identity is confirmed, you'll receive notification.
Step 4: Link Bank or Payment Method
Link your bank account or other payment methods to the exchange platform for making payments when purchasing ANC.
Step 5: Purchase ANC
Find the option to buy coins on the exchange platform, choose the C2C coin purchase process, and then input the quantity of ANC you wish to purchase. Typically, you'll choose to buy USDT first and select your preferred payment method. Simply place the order, make the payment to the seller, and you'll receive the cryptocurrency. Once payment is complete, you can use your exchange assets to buy ANC.
Step 6: Store Your ANC
After purchasing, you can choose to store your ANC in the digital wallet provided by the exchange platform or transfer it to a hardware wallet under your control.
Step 7: Security Reminder
To protect your exchange account and ANC assets, be sure to use a strong password and enable two-factor authentication.
ANC Price:Anchor Protocol is a lending and borrowing protocol offering up to 19.5% yield on stablecoin deposits. Lenders can deposit their UST and earn attractive rates on their investments while simultaneously benefiting from low volatility. The price fluctuates daily, You can go to the exchange: Bybit to check the price.
Recommended Similar Coins: MIR、SRM