In the race for CRV tokens, Curve Finance investors seem to be winning whatever happens.
Key Takeaways
Convex Finance is a new DeFi protocol offering yield farming optimization on Curve Finance’s stablecoin pools.
In order to boost yields, both Convex Finance and Yearn Finance need to lock CRV tokens in Curve Finance’s vesting escrow.
As a result of the battle between the two projects, CRV has jumped 59.5% in the last week.
Optimizing yield on Curve Finance’s pools is Yearn Finance’s bread and butter, but newcomer Convex Finance is gaining rapid traction as the two DeFi protocols fight for Curve’s liquidity provider tokens.
Yearn vs. Convex
In what some are calling “The Curve Wars,” DeFi protocols are battling to attract liquidity from Curve Finance (Curve) investors.
The two biggest contenders of this race to lock CRV are Yearn Finance (Yearn), a popular yield farming optimization protocol, and Convex Finance (Convex), one of DeFi’s newest protocols. Convex is offering attractive interest rates on veCRV tokens by incentivizing stakers with its own governance token CVX. DeFi users can earn veCRV by vesting CRV for an extended period of time. It is also incentivizing SUSHI holders by rewarding those who stake cvxCRV in Sushi’s cvxCRV-CRV liquidity pool. The cvxCRV token can be earned by staking CRV in Convex.
In essence, the fight between the projects centers on which one can offer the best returns on Curve’s stablecoin pools. While Yearn can’t incentivize participation with its governance token YFI, Convex can. Although Yearn provides better yield optimization, the liquidity mining rewards have seen Convex surpass Yearn’s yield on many Curve pools. This has helped the young protocol to quickly surpass $1 billion in total value locked.
2 weeks, 3 commas.
$1,000,000,000+ TVL pic.twitter.com/NDOVabZB11
— Convex Finance (@ConvexFinance) June 1, 2021
In the end, the real winners of this competition might be Curve and CRV holders. While Yearn and Convex seek to offer the best yields to their users, they often have to lock significant amounts of CRV to do so, buying it from the open market. The “Curve War” is really a war for CRV, which, no matter the outcome, benefits Curve. CRV is up 59.5% in the last week. It’s currently trading at $2.57.
Disclaimer: The author held ETH and several other cryptocurrencies at the time of writing. Yearn Finance founder Andre Cronje is an equity holder in Crypto Briefing.
Disclaimer Read More Read Less
The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.
You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.