The governance token of LUSD, a dollar pegged stablecoin collateralized by only eth, has seen a 37% gain after USDc froze a Tornado Cash pool with $75,000.
The LQTY governance token of LUSD was trading at $0.9 24 hours ago. It jumped and with some speed to $1.6 before now trading at $1.28.
RAI, which uses a soft peg whereby one token is now worth a somewhat stable-ish circa $3, with this also collateralized by only eth, has also seen its governance token FLX jump 56%.
It went from $27 to $54 and now trades at $43, with both these stables grabbing attention only recently due to the proposed EthereumPoW fork where pure defi dapps might keep running.
They’ve now gained another boost following the sanctioning of Tornado Cash which forced USDc, a dollar pegged token by the US based Circle and Coinbase, to comply with sanctions by freezing any Tornado Cash assets they control.
A couple of years back, this sort of event would have turned full attention to DAI, but the majority of DAI is now collateralized with USDc, making this potentially a negative event for Maker due to speculation regarding what might happen if USDc is forced to freeze the DAI smart contract.
That’s quite unlikely in any foreseeable future, but MKR is down 7% as the beneficiaries of this move turn out to be what can be called pure defi dapps.
LUSD itself is relatively new, launched in May last year, with its marketcap currently at just $180 million.
RAI also launched in February last year, with its marketcap at only $14 million, while its governance token is at $43 million fully diluted, and just $8 million circulating.
Making them small projects as until recently the DAI way was seen better with some arguments within DAI so ending up in favor of mixing its collateralization with centralized assets.
However that has changed with the focus on pure decentralized finance (defi) increasing both due to rising interest in regards to what exactly can work in a defi chain-split fork, and also now due to the actions of the US government in sanctioning an ethereum smart contract.
