Opinion If Curve dies, the entire DeFi market will need a considerable recovery period.

If Curve dies, DeFi will need a significant recovery period.

Author: Vic TALK; Source: Author’s twitter@victalk_eth

Here are my personal opinions on the liquidation event of Curve: The most dangerous period of liquidation test seems to have passed.

A lot of debts on Fraxlend have been paid off, and now there is only 9.1 million left, which seems to be at a healthy level.

This crisis is completely due to the personal reasons of the founder Michael.

Although he sold coins through OTC today to repay the debt, it is still profitable compared to the price he bought them at.

Michael’s massive Crv position on the chain has not only caused today’s liquidation situation, but also tied the price of Crv and a large part of the defi together. Once Crv is really liquidated, not to mention that the entire Crv ecosystem is likely to be finished, there will also be a large amount of debt on lending protocols such as AAVE.

If Curve is finished, the loss for defi will exceed 60%-70%, and the recovery period will be quite long.

The power of individuals can influence the trend of the entire industry, which is truly ironic for the “decentralized” Web3 industry.

Selling coins through OTC solved the urgent problem, but may also lay down bigger troubles.

One of the main reasons why Crv did not continue to plummet today is because there are no chips in the market. Michael sold 54.5 million Crv to various investors today, which means the chips have been sent out. Next time a crisis occurs, it is uncertain whether the price of Crv will plummet rapidly.

Not all the people who bought OTC are for saving Curve. After all, the price of $0.4 is quite attractive, and they are basically stakeholders. The six-month lock-up clause is not a smart contract, so it is not ruled out that some people may directly dump their holdings.

Let’s stick to the facts and discuss the matter at hand instead of talking about other things.

No matter what the reason for the attack on Curve, it is responsible and has made mistakes. If you make a mistake, you should endure it instead of blaming others and attacking them. This is not a good attitude.

I hope Curve can successfully overcome this crisis. Personally, I have great confidence in Curve’s product itself and its economic model design.

We will continue to update Blocking; if you have any questions or suggestions, please contact us!

Share:

Was this article helpful?

93 out of 132 found this helpful

Discover more

Blockchain

The value of BTC holdings in this country may exceed the gold reserve

According to reports, Bulgaria has more than 200,000 bitcoins. With the price of bitcoin rising, it is now worth abou...

Blockchain

Bitcoin plummeted, where did the money go?

If archeologists study Bitcoin in the future, it will definitely give a name to the change in the cryptocurrency mark...

Opinion

What happens if the Bitcoin ETF fails?

Investors have been waiting for a Bitcoin spot ETF for nearly a decade, and now it seems to be just around the corner.

Blockchain

Bitcoin broke through $5,500 because the largest brokerage in the US is testing BTC transactions?

At noon today, Bitcoin quickly pulled up and the price broke through $5,500. As of press time, the price remains abov...

News

Babbitt column | "Does one chain alone" feasible?

Before 2019, I always held the concept of "one chain is big". I believe that in the future development of t...

Blockchain

Can US idle home appliances provide years of energy for Bitcoin? Cambridge University Innovation BTC Mining Index

The issue of energy consumption in the Bitcoin network has long been the focus of debate among loyal supporters and c...