Cryptocurrencies have lost the shine they enjoyed in 2021. Most of them have dropped more than 40% from their all-time highs, and the daily trading volumes for many coins have declined. Yet amid the turmoil, some cryptocurrencies will continue to perform well. In this report I explain why Terra is my top cryptocurrency pick to buy right now.
What is Terra?
Terra is a prominent blockchain project launched by a team of South Korean software developers. Inspired in part by Bitcoin, the team aimed to create a new form of money that is simple to use and secure. Their first notable product built on the network was Chai, a payment platform that grew to become one of the country’s most popular fintech apps.
Today Terra is best known for its algorithmic stablecoins. A stablecoin is a cryptocurrency designed to maintain a stable value by being backed or stabilized relative to another stable asset, such as the US dollar. Unlike collateralized stablecoins such as Tether and USD Coin, Terra’s stablecoins are designed to respond to market forces of supply and demand. When demand for Terra’s stablecoins rises and supply is constrained, their price mechanisms adjust accordingly.
TerraUSD (UST) ranks as one of the largest stablecoins in the market, with a market capitalization exceeding $16 billion. Terra also issues TerraKRW (KRT), which currently has a market value of roughly $30.7 million.
Terra’s Growth
The network’s native token is called LUNA. According to CoinGecko, LUNA has a market capitalization of more than $35 billion, placing it among the top cryptocurrencies by market cap.
Like other major blockchain projects such as Solana and Near, Terra attracted hundreds of millions—and in some cases billions—of dollars from venture capital. In February, developers raised $1 billion through a token sale to finance the project’s initiatives. The team stated the funds would be used to build a bitcoin reserve to back its stablecoins.
In March, developers announced further purchases, including a plan to acquire $10 billion worth of bitcoin and an additional $200 million in Avalanche tokens. These purchases were intended to strengthen the reserves backing the stablecoins and support broader ecosystem goals.
Terra Ecosystem
Another reason Terra is my top pick is the rapid expansion of its ecosystem.
While Terra is widely recognized for its stablecoins, it has also become an important platform for decentralized finance (DeFi) applications. The popularity of Terra’s stablecoins and the growth of LUNA have attracted an increasing number of developers and projects to the network.
According to DeFi Llama, Terra grew to become the second-largest platform for DeFi development after Ethereum. If this trend continues, Terra could further challenge Ethereum’s dominance in the coming years.
Terra’s total value locked (TVL) sits around $28 billion, and some of the largest DeFi applications are built on the network. Anchor Protocol is one of the most significant DeFi platforms on Terra, with a TVL of approximately $15 billion and ongoing growth. Other notable projects include Lido (with roughly $8.22 billion TVL) and Astroport (around $1.6 billion TVL). Additional leading DeFi applications on Terra include Stader, Mirror Protocol, and Prism Protocol.
Notably, 11 applications within the Terra ecosystem each have TVLs exceeding $100 million—a substantial figure given the ecosystem’s relatively recent expansion.
Terra Price Performance
Another reason I consider Terra an attractive buy is that its performance often moves independently from Bitcoin and many other coins. For example, LUNA reached an all-time high in 2021 while Bitcoin had not yet fully surpassed its own record at that time. Over time, LUNA has outperformed Bitcoin and several other tokens in certain periods, making it an appealing option for investors seeking diversification and exposure to a different performance profile than Bitcoin.
In summary, Terra combines algorithmic stablecoins with a rapidly growing DeFi ecosystem, significant developer interest, and a price performance that can diverge from broader market trends. Those factors together explain why I view Terra as the best cryptocurrency to buy right now.