Over the past two months, the most anticipated asset within the Berachain ecosystem has undoubtedly been DOLO, the native token of the Dolomite lending protocol. Starting from a low of $0.03 in June, DOLO has soared to $0.3 in just two months, a nearly tenfold increase. This surge has not only made Dolomite a hot topic for investors but has also been viewed by the market as a significant signal that the Berachain ecosystem has entered a new phase.
Dolomite: The “absolute core” of ecological lending
In Berachain's landscape, Dolomite isn't just another protocol; it's the "absolute core" of the lending ecosystem. It accounts for 90% of the ecosystem's lending TVL, virtually monopolizing the flow of funds in the sector.
From an architectural perspective, Dolomite adopts a "stable core + modular expansion" model. The core layer maintains protocol stability, while the modular layer allows for flexible iteration. This architecture ensures long-term reliable operation while enabling rapid adaptation to the evolving needs of DeFi.
Compared with traditional lending protocols such as Aave and Morpho, Dolomite’s innovation lies in:
● Virtual liquidity system : Users can earn interest and conduct leveraged transactions, significantly improving capital efficiency.
● Dynamic collateral mechanism : supports lending of non-standard assets while retaining governance and ecological rights.
● Extensive asset support : covering more than 1,000 assets, expanding the boundaries of lending and trading.
Since migrating to the Berachain mainnet in February of this year, Dolomite has been deeply integrated with the PoL (Proof of Liquidity) mechanism, allowing users to retain governance, staking, and income rights while borrowing and lending, making it one of the most sticky protocols in the ecosystem.
The positive factors behind DOLO's surge
DOLO's rise is not just the result of market sentiment, but the result of multiple positive factors:
1. Expected collaboration with WLFI: World Liberty Financial (WLFI), a Trump family-related project, plans to establish in-depth cooperation with Dolomite, including access to Treasury-linked vaults and the USD1 stablecoin. This potential collaboration has sparked great market speculation.
2. Amplification of narrative effect WLFI has a distinct political color, which has injected DOLO with exposure beyond the crypto circle. The market believes that this may be an opportunity for the Berachain ecosystem to establish connections with traditional capital and mainstream society.
3. Berachain's BECTRA upgrade and the launch of PoL v2, an ecosystem amplifier , significantly improved transaction efficiency and capital accumulation. Leveraging this mechanism, Dolomite's TVL growth rate far exceeded the ecosystem average, making it a key node for capital accumulation.
Accelerating the operation of the ecological flywheel
Since the launch of the Berachain mainnet, the ecosystem's TVL has soared from $1 billion to $2.5 billion, with Dolomite making a significant contribution. It has not only attracted over $3.3 billion in stablecoin loans but has also become a liquidity provider for DEX and the LSD protocol.
The design of PoL v2 further accelerates the “liquidity flywheel”:
● Lenders lock up their assets to reduce market selling pressure;
● PoL incentives amplify benefits and increase participation enthusiasm;
● More funds are pouring into the ecosystem, further supporting TVL growth.
This positive feedback loop has become the most solid foundation for the price increase of DOLO.
The revelation brought
DOLO's performance may not only be a story about an individual asset, but also a prelude to the explosion of the Berachain ecosystem. For investors, DOLO's rise suggests several key signals:
1. First-mover advantage in ecological infrastructure : In the early stages of emerging public chains, the most basic lending and DEX protocols often generate excess returns.
2. Dual drive of narrative + mechanism : Narrative alone may be effective in the short term, but Dolomite combines the structural dividends of the PoL mechanism to make its rise more sustainable.
3. Capital is concentrating : Cross-chain bridge data shows that Berachain has become the preferred chain for net capital inflow. Capital trends are worth tracking continuously.
Overall, DOLO isn't an isolated "monster coin" phenomenon, but rather a sign that the Berachain ecosystem has entered a new phase. In the future, as the WLFI partnership materializes and more protocols mature, Berachain may experience a similar explosion to Solana and Ethereum in their early days.
