Why is Curve Dao (CRV) crypto trailing today?

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Why is Curve Dao (CRV) crypto trailing today?

Curve Finance’s (CRV) proposal to end emissions of its CRV tokens from pools related to TerraUSD (UST).
Image source: © Kdrs32 | Megapixl.com

Highlights

  • Launched in 2020 by Michael Egorov, the Curve Dao is a stablecoin DEX that uses the automated market maker (AMM) model to maintain liquidity.
  • The 88th-ranked CRV token was trading at US$1.09 with a 24-hour trading volume of US$35,80,11,569 on Friday.

It’s been more than a week since the Terra Luna crash tanked the entire crypto market. But things are gradually changing, and it seems the stablecoins market is slowly getting back onto its feet. 

On 20 May, the stablecoin market boasted a market cap of US$160,534,323,280 and a volume of US$73,122,646,505. At the time of writing (5:50 am GMT+1), it was up by a mere 0.33%, but it’s perhaps the first time it saw green. 

However, the mood wasn’t spread overall as the stablecoin DEX (decentralised exchange) Curve Dao (CRV) was down 11.53%. Launched in 2020 by Michael Egorov, the Curve Dao is a stablecoin DEX that uses the automated market maker (AMM) model to maintain liquidity. Built on top of the Ethereum protocol, Curve DAO soon moved to other blockchain networks, such as DAI, Fanton, and Solana.

Related links: Top 10 cryptocurrencies beyond Bitcoin to watch in 2022

The CRV protocol offers seamless exchanging of different ERC-20 tokens while offering the swap support to other cryptos such as DAI. Offering low slippage rates and low fees allows the users to maximise their returns with the best interest rates. 

Why is CRV token trailing?  

The CRV token hasn’t had the best performance on the market of late. The token has suffered losses of over 52% over the past 30 days. The losses were primarily the result of stablecoins collapse resulting in increased sell-off by the market participants. 

Related links: What does Terra's (LUNA) realistic revival plan look like?

But Friday’s losses have mainly been on the back of Curve Finance’s proposal to end emissions of its CRV tokens from pools related to TerraUSD (UST). The proposal stated that the on-chain governance proposal had pointed out the risks associated with the UST on Curve pools that made it problematic for users and retail participants.

Though the proposal is not a done deal, at the time of writing, 100% of the votes cast by the Curve Finance community are in favour of killing the emissions to all UST gauges. The voting will be open for another five days. As the results had been so unanimous, it would be tough to imagine that the results will have a drastic change. 

How is CRV Price faring? 

The 88th-ranked CRV token was trading at US$1.09 with a 24-hour trading volume of US$35,80,11,569 on Friday at (5:50 am GMT+1). The token was trailing by 11.53% in the past 24 hours with a live market cap of US$49,97,41,435 and 45,77,48,938 CRV coins in circulation. 

Despite being down, the CRV token witnessed decent investors’ interest as its volume was up by 137.57% in the past 24 hours.

Conclusion

There is no doubt that TerraUSD’s losses have impacted the fortunes of other stablecoins. The Terra losses have come as a lesson to other coins so that they don’t the same mistake on their platform. 

The market participants are more mindful of the changes made by the other stablecoins. It remains to be seen how long the TeraUSD’s aftereffects will continue to loom over the heads of other stablecoins. Market participants will do well to do their due diligence and conduct thorough market research before entering the crypto market. 

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