Home Coins Blockchain Bitcoin Ethereum How to Mining NFT Press releases Regulation Most Featured

Curve's New Stablecoin crvUSD is Inspiring New DeFi Wave

Author Avatar
By Jessy Sloan - - 5 Mins Read
curve dao finance

crvUSD stablecoin is leading another decentralized finance wave, according to reports, as more than $2 million have been invested into the new project by DeFi degens. crvUSD stablecoin launch has been highly anticipated by Curve Finance, and they just announced that they had gone live on Ethereum.

The smart contracts for the stablecoin were deployed into the Ethereum blockchain on Wednesday, and Investments started pouring in hours after the crvUSD launch. DeFi degens invested more than 2 million USD on the project even before its user interface went live. 

Curve Finance is a stablecoin-focused decentralized exchange that has been serving the purpose of providing different decentralized services. One of the major market services is low-fee swaps, boasting nearly $5 billion in total value locked. Within the past 24 hours of deploying the smart contract, the governance token of the DeFi exchange CRV has gone up by more than 7%. 

CrvUSD Price Outlook 

CrvUSD is a project that is looking to disrupt the whole decentralized ecosystem. According to the developers of this project, they are aiming to become a new generation of decentralized stablecoin that would bring much-needed changes in the decentralized finance space.

One of the objectives of Curve Finance with the launch of the stablecoin is to allow their users to mint crvUSD against collateral assets deposited in the protocol. The major reason they are doing this is to allow users to access the liquidity of the governance token while simultaneously earning yield on their deposits. The new way of earning from minting crvUSD tokens will drive the changes Curve Finance wants to see in the DeFi sector. They want users to have much participation in the finances of the project instead of being onlookers. 

Curve Finance officially decided to launch the project after running crvUSD on the Sepolia testnet. Running the DeFi stablecoin on the Sepolia testnet allowed Curve Finance and its developers to get extra information on the expected success of the project.

A repository on Github.com described the testnet deployment as intended to test whether Etherscan can verify crvUSD. Etherscan is a popular blockchain explorer used by prominent stablecoins. It was on the 25th of April that Curve Finance developers deployed crvUSD on the Sepolia testnet.

A notebook and a pencil, and some stablecoins on a wooden table

CrvUSD to Introduce LLAMMA Liquidations 

One of the promises stated in the crvUSD whitepaper is the introduction of the lending-liquidating AMM algorithm, also known as LLAMMA Liquidation. The major reason Curve Finance would be introducing this form of algorithm is to reduce the challenges users face while borrowing. There's also another effect on the LLAMMA Liquidation. When the Ether collateral backing crvUSD approaches its liquidation price, the Curve Finance ecosystem will begin to convert them to stablecoins. However, when the price of Ethereum starts to increase, those stablecoins are converted back to ETH. 

Foobar, a web3 developer, commented on the new disruption and changes crvUSD would bring to the DeFi sector. He mentioned that the model Curve Finance is adopting will also help them reduce losses. "This transforms liquidations from a jagged, all-at-once, all-or-nothing affair with huge slippage losses into a smooth transitioning that could even earn the collateral holder swap fees if they weather the volatility," Foobar noted.