After the collapse of the Terra ecosystem and its algorithmic stablecoin, it was a very hot question what happened to the developers who contributed to projects on Terra’s network. According to the latest report from Electric Capital, more than half of the 323 open-source developers of Terra’s network stopped working on crypto projects altogether in December 2022.
In May 2022, Terra’s network and its TerraUSD algorithmic stablecoin collapsed, which lost its one-to-one peg with the US dollar. At that collapse of Terra, it lost more than $40 billion worth of assets. According to the Electric Capital report, around 180 developers seem to have stopped contributing to crypto projects. And from the remained developers, around 42 developers migrated to other Cosmos network projects, 35 developers have stuck with the network and working on Terra 2.0, and around five developers moved to Solana. While the rest of the 11 developers are now working with a Cosmos-based decentralized exchange, Osmosis.
For the DeFi ecosystem, the collapse of Terra was a huge blow because Terra’s ecosystem was built on Cosmos. After Ethereum, Terra had become the network of choice for DeFi traders. Electric Capital, who published this report on Terra developers, has been an investor in the decentralized exchange dYdX, centralized exchange Kraken, and software wallet MetaMask. According to the 2nd of February report from Decrypt, Avichal Garg, a partner at Electric Capital, said that an early and leading indicator of value innovation in arising technology ecosystems is developer engagement. Developers create killer applications that deliver value to end customers, which then draws more developers, he added.
After the collapse of the Terra ecosystem, different other crypto networks launched efforts to support developers migrate their projects. For example, Juno Network, a Cosmos-based blockchain, created a grant program to support Terra projects’ migration to the network. TronDAO, an organization behind Tron blockchain, also launched a $10 million fund to attract developers.