Launched in May 2023, Sui blockchain implements a unique architecture to achieve high scalability, using horizontal scaling to keep transaction fees low even during high demand.
The network is capable of processing multiple transactions in parallel, achieving instant finality and security. This creates an ideal environment for DeFi protocols to thrive, as seen from the surge in TVL on Sui to more than $340M as of recently.
One of the fastest-growing DeFi apps that reflect Sui’s efficiency is Scallop, a lending protocol that has gained prominence within the Sui ecosystem.
Scallop Protocol, a Prominent Financial Hub in the Sui Ecosystem
Scallop is also the first DeFi project to be awarded an official grant from Sui Foundation. It has also obtained various awards from Sui Builder House hackathons.
Scallop Protocol offers a comprehensive suite of institutional-grade features, including tools for building Sui Programmable Transaction Blocks (PTxs), Scallop SDK for interacting with Scallop, Sui Kit for interacting with Sui using the TypeScript SDK, and sCoins (Scallop Market Coins) for zero-cost flash loans.
Through Scallop protocol, users will be able to borrow and lend major stablecoins, such as USDC and USDT, as well as SUI and CETUS, the native token of Cetus, a Sui-based decentralized exchange (DEX). Through its temporary incentive program funded by Mysten Labs, Sui Foundation, and Openblock Labs, Scallop rewards both lenders and borrowers who receive SUI tokens for participating in its ecosystem.
In the final quarter of 2023 and early 2024, Scallop protocol has experienced exponential growth in TVL (Total Value Locked). As of 18 January 2024, Scallop’s TVL has reached an all-time high of $64M, making it the Number 1 DeFi protocol on Sui and the leading lending protocol on Sui.
Scallop Protocol has also recently reported its latest milestone achievement of hitting an all-time lending and borrowing volume of $4.2 Billion, and a total flash loan volume of $205 Million.
This growth was due to the attractiveness of Scallop’s lending pools, offering users the opportunities to earn interest on their crypto holdings or borrow assets for various uses. The protocol’s emphasis on accessibility, security and user-friendly interfaces also plays a factor in boosting its appeal to DeFi users.
The Scallop team — comprised of cybersecurity, fintech, DeFi, and quantitative trading experts — aims to build a comprehensive monetary market leveraging Sui’s composability and security, implementing risk management and offering ongoing user support.
Upcoming Developments for 2024
Within just the first 2 weeks of 2024, the Scallop team has already pushed out 2 major updates. The team has pushed out an UI upgrade for the Scallop dApp to enhance the user experience, as well as an integration with Aftermath Finance to provide Scallop Swap – a tool that allows users to make multiple swaps at once.
Scallop has also crossed multiple notable milestones; $5b Lending/Borrowing Volume, $200M in Flashloan Volume, 1.5 Million + Sui Mainnet wallet addresses and has other 3 DeFi protocols built on top of Scallop.
Q1 of 2024 is going to be an exciting time for all Scallop users, as the team has plans to recognize the early supporters and users with their native token, SCA.
Scallop Protocol has already rolled out Phase 1 of their token reward, where they rewarded early supporters who have supplied and borrowed assets since the beginning, as well as active members of the Scallop community.
For Phase 2 of Scallop’s token launch, the team has announced that they will be prioritizing lenders and borrowers. Held over a period of 2 weeks, lenders and borrowers on Scallop will be able to receive points that can be exchanged for their Mystery Pearls. These Mystery Pearls are the core of Scallop’s token launch event, and determine the allocation of $SCA a user will receive.
Scallop is the pioneering Next Generation peer-to-peer Money Market for the Sui ecosystem and is also the first DeFi protocol to receive an official grant from the Sui Foundation.
The protocol offers a range of financial services, including high-interest lending, low-fee borrowing, asset management, and automated market-making (AMM) tools, all on a single platform. Additionally, Scallop provides a software development kit (SDK) that enables professional traders to easily implement complex trades, including zero-interest loans.
By emphasizing security and adhering to best practices, Scallop aims to reduce the risk of malicious behavior in the DeFi space, providing users with a trustworthy and reliable platform.
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