Cryptocurrency may sound like a utopian virtual world to the uninitiated. Veterans know it to be just as competitive and unpredictable as any other industry. That accurately describes what is happening amidst the Curve Finance project’s Curve Wars.
Read on to know why Curve (CRV) is outperforming other Digital Assets:
These battles allow crypto to evolve while gradually shedding projects that don’t have market utility. Bitcoin has had some hard forks where the community splits, and two separate cryptocurrencies emerge. Crypto gambling enthusiasts on BC.GAME will know the most prominent Bitcoin fork; Bitcoin Cash. Such upheaval and jostling are not unusual because of this industry’s value.
Curve (CRV) Finance is emerging as a vibrant platform for crypto entrepreneurs. Its governance token, CRV, is one of the most exciting assets in the DeFi sector.
About Curve Finance DEX
Before exploring Curve Finance DEX, let’s go through the idea of a decentralised exchange. Cryptocurrencies need a marketplace for buying and selling. Ironically, centralised exchanges emerged as the most dominant for an industry that launched on the principles of decentralisation.
Gradually, decentralised exchanges emerged. These are crypto marketplaces that eliminate the need for centralised supervision. Instead, they rely on automation and smart contracting technology to match user orders.
Uniswap was a pioneer and put DEX services on the map. Since then, alternatives like Curve Finance DEX have been emerging.
Curve Finance operates as a series of asset pools. These pools contain cryptocurrencies worth roughly the same value. Notably, Curve Finance focuses on Ethereum-based stablecoins, facilitating their trustless exchange.
These are unique cryptocurrencies with their value pegged to a national currency or a stable asset. Therefore, Curve Finance operates as a low-fee, low-slippage market maker protocol, allowing users to exchange stablecoins efficiently. Users can contribute assets to the liquidity pools and earn fees through the decentralised liquid aggregator.
The Automated Market Maker (AMM) uses a price algorithm to facilitate transfers and trades. It is different from a market order which matches buyers and sellers.
Automation from the Ethereum blockchain is vital because it eliminates the need for a centralised supervisor to approve every transaction. Curve Finance has an innovative pricing model that optimises trading for tokens with similar price dynamics.
Stablecoins are an integral part of the crypto landscape. They serve to provide some stability in a notoriously volatile crypto market. Stable coins like DAI, USDT, USDC, and TUSD are now prominent in crypto circles. Curve Finance provides a suitable platform with low fees and low slippage for such transfers.
Users can exchange stablecoins or tokenised versions of coins quickly. For instance, it is perfect for tokenised forms of Bitcoin such as WBTC and renBTC. Others like Yearn Finance’s yUSDT and yUSDC also feature on Curve Finance. Pool participants earn the swap/gas fees and the yield from yield-bearing tokens.
The Curve Decentralized Autonomous Organization (DAO) utilises the CRV token for governance. Governance tokens are crucial for voting rights in a DAO.
These token holders decide to vote on-chain by locking their tokens and converting them to veCRV. These converted tokens are helpful for governance, with perks like governance rewards, trading fees, and airdrops part of the allure.
What does Curve Wars mean?
Given the importance of veCRV, controlling the Curve Finance trajectory means accumulating significant amounts of CRV and converting them to veCRV.
Some entities are onto this power move. For instance, Yield-boosting applications Convex Finance and DeFi protocols like Yearn Finance and StakeDAO are making moves in the staking power play. These protocols incentivise CRV holders by offering attractive staking returns.
The protocols then deposit the CRV and collect the veCRV. From the above, the converted tokens hold voting power on Curve Finance and rights to allocate more CRV to the pools they provide liquidity. Accordingly, these protocols conduct what amounts to a land grab by getting the right to reward themselves.
Therefore, these protocols are in an arms race to get more CRV. Their efforts have gotten the attention of the wider Curve Finance community. Accordingly, the tussle is earning “Curve Wars” to reflect this battle for more voting power.
Convex Finance has emerged as the leading contender, holding close to half of the total supply of veCRV. It crossed $20 billion in Total Locked Value (TVL), becoming one of the most significant DeFi protocols by TVL.
Why is Curve (CRV) outperforming other Digital Assets?
Bitcoin has experienced some stagnation in comparison to the early 2021 price movement. The opposite has occurred for CRV.
Notably, this token is on a five-month winning streak, better than all major cryptocurrencies. It began the year well, with double-digit growth in the first week of January. Incredibly, it rose more than 100 percent in the last quarter of 2021.
The aggressive purchase by these protocols is keeping prices at an excellent level. Similarly, stablecoins are also growing in stature with the broader cryptocurrency industry.
The factors bode well for CRV prices and could be why the tokens are hot in the market. Accordingly, CRV prices have been green despite the broader slump in cryptocurrency. For a project of this size, such resilience has attracted attention in the market.
Looking Forward
Curve Finance DEX is rising quickly as a notable destination in cryptocurrency. Its focus on stability and composability is reaping dividends already. The scramble for CRV shows how the market appreciates the importance of this project.
Stablecoins like USDT on leading online casinos like BC.GAME provide a valuable function for crypto traders wary of volatility. This platform will serve as a stablecoin DEX. Accordingly, the goal is to have a low slippage and low-cost, stablecoin marketplace. It will be fascinating to follow the progress of Curve Finance.
