14 July 2021| ZebPay Trade-Desk
Curve is a DeFi exchange for stablecoins like (DAI -USDC) and utilises AMM’s to provide and manage liquidity on the platform. It was launched in January 2020 and has now become one of the largest decentralized exchanges, since it witnessed phenomenal growth in the latter part of 2020. In August last year, Curve introduced a decentralized autonomous organization (DAO), with CRV as its native token. The DAO is built on an Ethereum based tool, Aragon, which connects multiple smart contracts that enable users to deposit liquidity. As of June 2021, 39 active pools are available for swapping among the stable coins and other assets on the platform.
Curve DAO Token Snapshot (at the time of writing):
| Market Capitalization | 0.6 Billion |
| Current Price | $1.54 |
| 24 HR Volume | $82,515,566.81 |
| All Time High/Low | $60.50/$0.33 |
| Script in Circulation | 381,182,461 CRV |
| Total Supply | 1,545,719,593 CRV |
Curve has selected to upgrade its trading algorithm for the exchange of stable coins. It operates as a crypto-forex market as it provides distinctive benefits to traders and liquidity providers. It has very low trading fees, and stablecoin trades are much cheaper than on Uniswap for example. This helps to minimize slippages as well, while in turn enables traders to engage in high-volume trading. Most importantly, there is no impermanent loss. On Curve, the Liquidity providers contribute stable-coin pairs that almost eliminate impermanent loss. A huge part of this gain comes from the fact that Curve can swap one stablecoin for another one directly.
If you would like to read more on CRV, and how it will operate on the ZebPay exchange, please click here.
Investment Analysis:
SNX coins are native tokens of Synthetix, it is a highly liquid asset based on the Ethereum blockchain. The protocol is created in a way that exposes users to the underlying assets via synths, without having to actually lock up that asset. Uniswap is probably the leader in the DeFi sector, the native token is UNI, and its main priority is to formalize Uniswap as a self-sustaining public infrastructure while still carefully protecting core and primary qualities.
SushiSwap is the infamous twin of Uniswap, whose aim is to modify the AMM market but also add extra characteristics which were not present earlier on Uniswap, such as more rewards and incentive for users participating in the network through its native token, SUSHI.
Curve is a DeFi exchange for stablecoins that uses AMM to supervise liquidity. It launched DAO with CRV as its native token. It’s implementing a compound time-based system of staking to exchange its in-house token into veCRV, where veCRV is an internal token used for governance purposes and the users can claim the cash flow generated by the protocol.
In the table below we can see that CRV has grown around 170% in just half a year compared to UNI which has risen by around 338%. CRV is closely followed by Sushi and SNX at 130% and 45% respectively. These assets have been giving a great return, in terms of market cap UNI is leading at $11 bn followed by SNX at $1.2bn, SUSHI at $0.9 bn, and then CRV at $0.6 bn. Hence the market rank is also representing it. CRV is an ERC-20 token with a return of -87% and it has been the worst in the group with SNX leading with a return of 2370%.
| Asset | SNX | UNI | SUSHI | CRV |
| YTD Return (%) | 45% | 338% | 130% | 170% |
| Return from ICO (%) | 2370% | 1502% | 108% | -87% |
| Market Capitalization ($, bn) | 1.28 | 11 | 0.91 | 0.61 |
| Market Rank | 63 | 10 | 75 | 93 |
CRV coin is created mainly to swap between ERC-20 tokens. Some examples of stablecoins (like USDT and DAI) and Ethereum-based Bitcoin tokens (like WBTC and renBTC). It was launched in the year 2020 in January and within 1 ½ year, it has significant growth in the last quarter of 2020.
In just six months the price of the asset has risen by around 53% The Month-on-Month return for this year has been somewhat volatile. It rose around 119% just from December to January. After that, the growth continued at a significant level with negative growth acting as a reset for the coin.
The market crash in May may be attributed to the fall in the ROI since May. While the volume of growth has been kind of stable. From last year to this June the asset’s volume has swelled by around 1200%. It had an instantaneous rise of around 1146% in January 2021. The volume continued to rise until April when it started falling and it’s continuing that trend.
| CRV | Jan 2021 | Feb 2021 | March 2021 | Apr 2021 | May 2021 | Jun 2021 |
| Price (US $) | 1.33 | 2.74 | 2.51 | 3.09 | 2.65 | 2.02 |
| MoM ROI (%) | 119.19% | 105.05% | -8.29% | 23.23% | -14.20% | -24.00% |
| Volume | 0.14 | 0.14 | 0.84 | 0.57 | 0.29 | 0.13 |
| % growth | 1146.53% | 1.53% | 500.16% | -32.31% | -48.97% | -56.18% |
Conclusion:
CRV is a token based on the Ethereum blockchain that powers Curve finance. It has gained considerable traction via branding itself as an AMM for stablecoins. To minimize the impermanent loss, the majority of the liquidity pool consists of similar assets, but in the last months, it launched a USDT-WBTC-ETH “tricrypto” pool.
The CRV coin can be used as an asset to be locked up for various periods of time to vote on governance and claim rewards from protocol fees. CRV is not among the highest rank in the crypto space but we shouldn’t forget it’s fairly new to the market and is continuously evolving. CRV has held up good in terms of price and stayed somewhat stable while the crypto space was very volatile this year.
The volume of the asset has been harmonious and it has continued the falling trend since April. CRV’s maximum supply is around 3 billion and its current circulating supply is only around 11.5% of that amount. While its counterpart SNX has 54% and Sushi has 50% respectively of its supply in circulation.
The launch of CRV token and DAO has brought immense popularity and profitability to curve finance. The token is widely used as it used to award users based on the commitment of liquidity and length of the ownership. The token is young and thriving with the popularity of DeFi; it may just be the next trending thing leading the DeFi group along with Uniswap and others.
References:
Disclaimer : This report is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any investor. All investors should consider such factors in consultation with a professional advisor of their choosing when deciding if an investment is appropriate. The Company has prepared this report based on information available to it, including information derived from public sources that have not been independently verified. No representation or warranty, express or implied, is provided in relation to the fairness, accuracy, correctness, completeness or reliability of the information, opinions or conclusions expressed herein. This report is preliminary and subject to change; the Company undertakes no obligation to update or revise the reports to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events. Trading & Investments in cryptocurrencies viz. Bitcoin, Bitcoin Cash, Ethereum etc.are very speculative and are subject to market risks. The analysis by Author is for informational purposes only and should not be treated as investment advice.
