Starknet STRK Rockets to Fourth Largest Ethereum Layer 2 with $1.3B TVL After Chaotic Token Launch
The crypto community is abuzz with Starknet’s sensational rise, as the Ethereum Layer-2 scaling solution cemented itself as a major player seemingly overnight. Propelled by a momentous token airdrop and listing, Starknet’s Total Value Locked (TVL) has exploded past $1.3 billion, ranking it 4th amongst all L2 protocols.
TLDR
- Starknet’s TVL exceeds $1.3 billion just after launch, becomes 4th largest Ethereum L2
- Airdrop distribution faced issues but seen as successful overall, STRK listing on Binance aids adoption
- STRK token itself faces volatility and selling pressure, but market cap still impressive at $1.39 billion
- Unique zk rollup tech draws projects like Orbiter Finance and Rango Exchange to Starknet
- Early volatility expected for new L2s, but Starknet poised to navigate bear market with perpetuals trading
The protocol took center stage last week upon the long-awaited distribution of its native STRK token via airdrop. Over 700 million STRK was rewarded to early adopters from the allotted 1.8 billion, sparking intense activity and valuations for the formerly illiquid asset.
However, the launch ran into minor hiccups, with some recipients getting millions more tokens than others due to calculation inconsistencies. This led some holders to immediately dump STRK, crashing prices in the process. Nonetheless, Starknet’s trajectory has been virtually vertical since inception.
Per L2Beat, Starknet’s TVL now sits at a staggering $1.31 billion, up over 620% from deployment. Having convincingly surpassed the $1 billion level, Starknet trails only titans like Arbitrum, Optimism and Manta in the L2 rankings regarding liquidity depth.
The backing of top-tier centralized exchanges proved critical for Starknet’s leap to prominence. Binance, Huobi and OKX were quick to list STRK after launch, granting it access to vastly expanded liquidity pools. Starknet’s zk rollup technology also holds unique appeal, with bluechip DeFi platforms like Orbiter Finance opting to build within its ecosystem.
However, young L2 protocols often struggle with price instability in their nascent stages. True to form, STRK has been on a rollercoaster since launch, still facing unrelenting sell pressure from airdrop recipients that caused a 30% crater in trade volumes. STRK last traded at $1.92, nursing slight losses over 24 hours.
Nonetheless, Starknet seems firmly positioned for long-term success with a current market cap of $1.39 billion. By integrating advanced trading functionalities like perpetuals contracts, predominantly off Binance, Starknet can better navigate bear phases. The project also enjoys staunch community goodwill thanks to its generous airdrop rewards.
All things considered, Starknet is off to a remarkably promising start despite the usual early volatility. With Ethereum gas fees remaining prohibitive, the demand for well-designed L2 solutions like Starknet will only amplify over time.
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