So far, Curve DAO has been seeing enormous gains at the start of the month as CRVUSD, Curve’s native stablecoin, gains significant traction in users.
According to recent data posted by Curve DAO’s official Twitter page, the stablecoin has reached a supply and debt level of over $50 million, which indicates that the stablecoin is being used heavily just after two months after its launch.
CRVUSD now joins the growing number of stablecoins available in the industry. However, another tense moment in the crypto market occurred last month.
Some graphs pic.twitter.com/lHnNw6Cej1
— Curve Finance (@CurveFinance) July 1, 2023
Major Hiccup In The Stablecoin Industry
Just last month, Tether’s USDT depegged, prompting serious fears of another collapse on the horizon. According to some sources, it was mostly caused by an imbalance within Curve DAO’s Curve 3Pool. This small imbalance caused a 70% surge in USDT’s balance which indicated a significant sell-off.
In an interview with Tether CTO Paolo Ardoino, he emphasized Tether’s role as “a gateway to liquidity” and how Tether is solid. He also puts confidence in USDT by saying that “these events are a good test for us.”
Meanwhile, there is virtually no fear, uncertainty, or doubt surrounding CRVUSD, thanks to the ecosystem’s innovative utilization of LLAMMA—an exclusive algorithm designed specifically for CRVUSD.
LLAMMA: How Does It Work?
In a Twitter thread created by Poopman DeFi, LLAMMA uses a concept known as soft liquidation. The user must first deposit sfrxETH as collateral to borrow CRVUSD at an overcollatelrized ratio of 117%. LLAMMA then uses the price fluctuations of the two assets to rebalance the ratio between the two.
crvUSD is the most hard-core stablecoin to ever exist.
Instead of facing full liquidation when borrowing CDPs,
crvUSD introduced LLAMMA