Scallop Protocol: Shaping the Future of DeFi on the Sui Blockchain
Unlocking the Potential of DeFi with Innovative Lending and Borrowing Solutions
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Topics Covered
Rise in Development on Sui
Scallop’s Rise in Trust and Usage
Growth Strategies for Scallop
Scallop’s Team and Supporters
Quick Notes🏃♂️
Scallop Protocol boosts the Sui network with its lending and borrowing platform, attracting developer interest and user engagement.
The protocol’s TVL has only increased in the last few months and it has launched an airdrop campaign.
The airdrop campaign positions Scallop to not only attract more users
But the campaign could also boost user retention for their engagement.
Thus, Scallop can be a major force within the Sui ecosystem.
Scallop’s APAC based team positions it to drive a large user base.
With that in mind, the platform has gained backing from VC investors.
Ultimately, Scallop Protocol has a lot of potential to be a force in DeFi.
Full Analysis📝
Scallop Protocol Ignites Sui Network Growth with DeFi and Airdrops
Last week, CryptoJeter highlighted the burgeoning Sui ecosystem.
In that article, we highlighted the rising developer interest in the Sui network.
Projects have started to engage users with the bull market only getting stronger.
More Web3 organizations are incentivizing users with airdrop programs.
One project that drives activity using airdrop incentives is the Scallop Protocol.
The protocol went on Sui mainnet early in 2023 and is serving a necessary use case.
Scallop is creating a platform to enable lending and borrowing on the Sui blockchain.
A comparison to Scallop’s capabilities is more established DeFi protocols like Aave.
The Sui network is growing rapidly and needs builders to create foundational capabilities.
Scallop is building the use case to enable lending and borrowing on the Sui blockchain.
Scallop's Soaring TVL and Innovative Airdrops Amplify DeFi on Sui
DeFi is a category that tends to be the first products on blockchains
With Sui’s rising popularity, Scallop is taking on the challenge of building out that capability.
The DeFi protocol is following a similar growth trend as the native layer one.
Scallop currently has a TVL of nearly 110 million dollars.
This is more than double the project’s December 2023 TVL, which was 40 million dollars.
Additionally, Scallop’s airdrop rewards users for lending and borrowing on the platform.
Currently, users can deposit stable coins to do these actions.
Depositing capital in the app benefits lenders as they can earn yield.
The user experience of Scallop is similar to other decentralized finance platforms.
For those unfamiliar with this process, there is generally a wallet connect button.
Initially, for the platform, users would need to download a Metamask Snap wallet.
Snaps are open-source adaptations of the Metamask wallet which extends its functionalities.
Kuna Labs developed a Sui snap which was the primary wallet.
However, Scallop now enables users with Sui Wallet, OKX, and Martian Wallet to connect.
For using the platform users receive points which make them eligible for rewards.
Currently, Scallop is in Phase 2 of its airdrop event.
Users who participate in the airdrop will accumulate points based on their activity.
These points enable users to earn Mystery Pearls which are redeemable for rewards.
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User Experience, Growth, and Partnerships is Key for Scallop’s Growth
Every blockchain has builders looking to build unique use cases in DeFi.
Even if Scallop doesn’t have top-notch competition on the Sui blockchain,
It will need to compete with products that are native to other chains as well.
This is especially true as the crypto space becomes more interoperable and multichain.
Thus, Scallop will need to create the best user experiences for DeFi users.
It makes sense for the team to conduct surveys and work with advisors to gain user feedback.
With this feedback, the Scallop team can identify and build for its user’s pain points.
Additionally, the Scallop team may be missing the moment if they don’t focus on business development.
As mentioned earlier, the Sui blockchain is growing very rapidly.
Thus, this growth period presents the opportunity to penetrate the DeFi market.
By focusing on building a brand and securing partnerships,
Scallop can increase the amount of lending and borrowing volume.
Increasing this volume potentially will not only create consistent revenue
But also drive more awareness for the Sui blockchain.
Scallop has a Global Team and Strategic Backing to be Successful
Scallop’s founders are based in Taiwan with the team
But is dispersed throughout APAC and likely beyond.
Thus, the startup has positioned itself to penetrate this market that has widely embraced crypto.
Scallop was founded by Kris Lai and Donnie Chen.
Both founders have computer science backgrounds from Taiwanese universities and have spent time as developers.
The funding of the project appears to be undisclosed
But, the team revealed it has funding from Mysten Labs, Sui’s core developer.
Scallop also has the support of venture capital firms Comma 3 Ventures and OtterSec.
Additionally, Cetus, another popular Sui DeFi protocol, is a financial supporter of some kind.
Outside of Cetus, Scallop was the first project to receive a grant from the Sui Foundation.
Scallop’s docs also mention a token that would make coin offerings a plausible pathway.
The project’s Taiwanese roots could make it likely to list on APAC-based exchanges due to geographical proximity.
This is another reason why it makes sense to concentrate on business development at this time.
The Advantages of Being an Early Adopter with Scallop
Understanding how Scallop works and being an early adopter may have benefits.
Scallop is currently rewarding early adopters through its airdrop
But the team has to drive their users to add value beyond using the product.
Thus, Scallop has the opportunity to use its audience to create an industry-leading user experience.
By gaining direct product feedback, Scallop could be able to compete with other DeFi projects.
Users should also look into using Scallop.
The team has shown a willingness to reward its users and wouldn’t be surprising if that continues.
Thus, early Scallop users have the opportunity to play a crucial role in Scallop’s ascension.
Ultimately, the early adopters of the platform could receive meaningful rewards for their dedication to Scallop.