How and Where to Buy Anchor Protocol (ANC)
South Korean Fintech company Terraforma Labs founded Anchor Protocol in March 2021. Daniel Shin and Do Kwon are the co-founders, and built the TerraUSD blockchain protocol together. The Terra platform hosts one of the largest stablecoins by market cap, $UST, as well as the TerraLabs token is $LUNA.
Previously, Do Kwon was CEO of a start-up, Anyfi, that provided decentralized wireless mesh networking solutions. He also boasts experience working with Apple and Microsoft as a software engineer.
Daniel Shin was co-founder of ecommerce platform Ticket Monster andFast Track Asia, a start-up incubator helping entrepreneurs to build operational companies
What Is Anchor Protocol (ANC)?
Anchor protocol is a high yield lending and borrowing platform where users depositing stablecoins can earn up to 19.5% APY. Those lending $UST can benefit from low volatility and attractive rates, and borrowers can use their $LUNA tokens as collateral without losing control of their holdings.
The Anchor protocol is attractive for investors seeking low-risk, low volatility opportunities for a high yield. Their investment increases the demand for $UST and mainstream adoption of the Terra project in decentralized finance (DeFi).
“Anchor is a decentralized savings protocol offering low-volatile yields on Terra stablecoin deposits. The Anchor rate is powered by a diversified stream of staking rewards from major proof-of-stake blockchains, and therefore can be expected to be much more stable than money market interest rates.” – Anchor Protocol website.
$ANC is Anchor protocol’s native crypto token. Deposited $ANC creates new governance polls and users that stake $ANC have the right to vote. $ANC also captures a percentage of the Anchor protocol’s yield, which means its value can scale in line with Anchor’s Assets under management (AUM).
What Makes Anchor Protocol (ANC) Unique?
Unlike many similar protocols in the money market space, Anchor has a user-friendly interface and uncomplicated functionality. Anchor’s primary purpose is to connect lenders with borrowers:
- Borrowers can receive a stablecoin loan without losing their investments. When they bond $LUNA tokens, they receive bonded $LUNA ($bLUNA) and can borrow up to 60% of their $UST collateral deposited. The interest rate is marginally higher than the interest paid to lenders.
- After 21 days, the bonded $LUNA can be unbonded, and the borrower receives $ANC tokens as a way to increase its adoption
- Lenders can gain highly attractive interest rates on their assets. By connecting a Terra Station wallet and depositing $UST, lenders pay a small transaction fee but can earn up to 19.5% APY for each block transaction (approx. 8 seconds) on a pro-rata basis
The Anchor protocol uses the profits from the spread between lenders and borrowers’ interest rates to earn between 5-7% APY staking rewards on Terra. The Anchor Yield Reserve acts as a treasury to cover costs if rates do not reach a state of equilibrium. For instance, to safeguard protocol stability, Terraform Labs put 70 million $UST into the Anchor Yield Reserve during the crypto market price correction in the summer of 2021.
$bETH tokens can also be used as collateral to borrow Terra stablecoins from Anchor. “bETH tokens are bAssets for Ethereum 2 staking, with their token value backed by Ethereum 2.0 staking positions.”
How and Where to Buy Anchor Protocol (ANC)?
If you’ve decided to invest in Anchor Protocol (ANC) tokens, choosing a reputable cryptocurrency exchange is the next step. Established in 2017, Binance has a great reputation, with over 1650 markets and more than 390 coins. The platform has an exchange wallet and a downloadable app, the Trust Wallet, enabling you to trade on the go, or check your $ANC investment:
- Register for an account on the Binance website
- Fill in your details and submit your ID documents for KYC compliance and to access all the services that Binance offers
- Deposit with your Mastercard or Visa or if you prefer, use the wire transfer option or with a supported cryptocurrency
- Find the “Exchange” tab and look for an available $ANC pair: ANC/USDT, ANC/BUSD, ANC/BTC, or ANC/BNB
- Send your $ANC to the Trust Wallet or an alternative wallet that supports Anchor Protocol (ANC) tokens
How do I Sell Anchor Protocol (ANC)?
- Open Trust Wallet and look for the “trade” tab. Most wallets are similar if you don’t have the Binance wallet
- Find $USDT, a popular stablecoin
- Sell your $ANC tokens for $USDT
- Transfer the $USDT to an off-ramp platform like Gemini or Coinbase
- Finally, in the off-ramp account, sell the $USDT for a fiat currency and withdraw to your bank account, hopefully celebrating your profits from investing in Anchor Protocol (ANC)
Should I Buy Anchor Protocol (ANC)?
Only you can decide if you wish to buy Anchor Protocol (ANC) tokens because we cannot provide professional investment advice. Make sure you only invest what you can afford to lose because the cryptocurrency market is unpredictable at times. Still, when you are ready to purchase $ANC tokens, choose an established, trustworthy cryptocurrency exchange like Binance and set up your crypto wallet prepared to transfer your coins. KuCoin is another reputable exchange with custodial and non-custodial services, and Gate.io has a cold storage wallet for users.
How do I invest in Anchor Protocol (ANC)? Safely?
Always invest or trade with a reliable cryptocurrency exchange with a solid reputation. Choose a platform with a broad range of markets and coins and 24/7 customer support. Register for an account with Binance, KuCoin or Gate.io when you have decided which one is best for your requirements. KuCoin lists ANC/USDT and ANC/UST. Gate.io has over 2,300 markets and more than 1,390 coins and lists ANC/USDT and ANC/ETH.
