Curve – CRV
Curve is a decentralized exchange for stablecoins, Bitcoin and Ethereum. By focusing on stablecoins, Curve Finance offers extremely low slippage costs and offers liquidity providers no impermanent loss. When looking to trade stablecoins in a decentralized manner, Curve will usually offer the best prices.
Curve Finance is a decentralized exchange (DEX) that provides trading of stablecoins or tokens within the same price range, such as the wrapped versions of Bitcoin and Ethereum.
On Curve, about 37 pools are active with which one can swap or provide liquidity. This includes yield-bearing token pools where users can deploy their yield-bearing tokens obtained from other protocols, in order to earn underlying yield, as well as the proceeds derived from swap fees.
This review of Curve – CRV was created for informational purposes. This article is not intended for promotion.
The liquidity pools are managed and controlled by the automated market makers (AMM). That is, when a token is swapped, the AMMs will rebalance the pools.
When a pool gets out of balance, the AMMs will reduce the price of the token encouraging traders to purchase it. This will attract arbitrageurs who will rebalance the ratio.
Another big difference from the AMMs of, say, Uniswap, is that Curve does not exchange to Ethereum. Uniswap exchanges token A for ETH, then ETH for token B, leaving the user with double transaction costs to pay.
Curve will swap to the desired token in one transaction, keeping transaction costs lower. Curve exchanges token A directly to token B within a single transaction.
The governance token, Curve was launched in August 2020 and has several purposes.
Curve token will serve as:
The Curve token has an inflationary model (Max Supply: 3.3 billion) but also has deflationary pressure due to the possibility of locking CRV on the platform in exchange for veCRV and the associated APY boost.
Curve was founded by Russian Michael Egorov. He studied at the Institute of Physics and Technology in Moscow where he earned his Ph.D. In 2014 he moved to the US where he worked for LinkedIn before founding the data encryption company, NuCypher in 2016.
Together with a small group of developers and community managers who are anonymous, he has been keeping the Curve platform running since 2020.
Twitter profile picture – Michael Egorov
Curve users earn income in a variety of ways.
Curve allows its users to provide liquidity in a stable manner, avoiding the extreme volatility. Curve does this by limiting the supply of tokens and focusing on stablecoins.
Curve’s liquidity pools also include tokenized versions of Bitcoin and Ethereum, which of course will also mean no impermanent loss for liquidity providers.For a complete overview of all active pools on Curve, be sure to check here.
Curve attracts liquidity providers by using what is called composability in DeFi. This simply means that investments on Curve can be used on other protocols and vica versa to earn additional rewards.
The total locked value that is fixed on the Curve platform hovers around $10 billion. Curve has since plotted against Ethereum, Polygon, Fantom and xDai. We can only conclude that Curve isn’t stopping anytime soon.
(Total value locked on Curve Finance, by DeFi Pulse)
Curve has become one of the most popular platforms in the DeFi ecosystem. It does not focus on volatility or speculation, but by using stablecoins, it can focus on stability and compatibility.
Because of Curve’s composability, the platform is deeply intertwined with the entire DeFi ecosystem.
Thus, Curve is not only used by Yield farmers like you and me but also provides liquidity to major protocols like Yearn, Synthetix and Compound, which are perfectly compatible with the Curve protocol. The future of Curve is potentially great.
Curve Finance guarantees the lowest amount of slippage when exchanging stablecoins in a decentralized manner. Liquidity providers no longer have to worry about lossy impermanent loss or risky ‘degen’ yield farming. Yet the Curve platform is not that simple to use. Therefore, it is important to do further research before making investments.
Disclaimer: Trading and investing in cryptocurrencies (also called digital or virtual currencies, altcoins) involves a substantial risk of loss and is not suitable for every investor. You are solely responsible for the risk and financial resources you use to trade crypto. The content on this website is primarily for informational purposes and does not constitute financial advice.