DeFi hype and upcoming mainnet upgrade support Zilliqa’s 69% rally (ZIL)

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Last month, Bitcoin (BTC) and Ether (ETH) were in the spotlight as they each hit new annual highs. Investors tend to focus their energies on higher cap altcoins, which leads to smaller cap coins that are outside the top 10 being ignored.

For example, Zilliqa (ZIL) has grown 69% in the last 30 days. Despite this impressive performance, the altcoin has underperformed ether significantly over the past six months.

Daily market performance in cryptocurrencies. Source: Coin360

The project was founded in 2017 by researchers at the National University of Singapore looking to improve the scalability of smart contracts. Currently, ZIL ranks 49th on CoinMarketCap, ahead of some well-known names such as Decred (DCR) and Basic Attention Token (BAT).

Decentralized Financing (DeFi) may have fueled the recent uptrend, but voting on betting and governance alone does not seem sufficient for a sustainable price increase.

The project now urgently needs the acceptance of dApps users and a locked total to show strength against the leading Ethereum.

Zilliqa (ZIL) in ETH and USDT terms. Source: Digital asset data

The graph above shows how ZIL has undercut the Ether price (ETH) by 42% in the past six months, despite its nominal price increase. Coincidentally, Zilliqa’s design is based on sharding, which enables parallel data processing, similar to Eth2.

As the DeFi sector exploded with a new influx of users seeking high-yielding returns from income farming, it became clear that the industry needed additional options to handle the rising transactions and fees.

Zilliqa uses a modified version of the proof-of-work consensus protocol and a proprietary programming language called Scilla. Therefore, it makes sense to compare performance with the industry leader in smart contracts.