What Is Curve DAO Token (CRV)? How Its Work?

Comments: 0Views: 107


Bforum Member

The innovation of Decentralized Finance or DeFi has introduced many promising implications in the future. Curve DAO and its native token has been involved in the DeFi space as new solutions. If you are interested in the project, let’s follow us by reading this article!​

1. What is Curve DAO Token?

The Curve is used DeFi platforms that utilizes an automated market maker (AMM) to manage liquidity. AMM is a protocol that uses liquidity pools (which is one of the core technologies present in the DeFi ecosystem) to allow digital assets to be traded automatically. The Curve platform provides a way to exchange token efficiency by maintaining low slippage rates that helps users trading with finest rates.

DAO is introduced as a decentralized autonomous organization. It has been found by developers to remove human errors and manipulation of investors by providing decision-making authority to an automated system and a crowdsourced process.

DAO allows people to send money anonymously from anywhere in the world. The main part of DAOS is managed by governance tokens which grant voting rights to token holders that similar to Curve DAO is governed by CRV tokens as well.

2. How does Curve DAO Token (CRV) work?

Also known as CRV, the native utility token of the Curve DeFi protocol is an important tool for exchanging stablecoins alongside other ERC-20 tokens. Differ from other exchanges that match buyers and sellers, Curve.fi provides an exchange platform that works on different behavior and leverages liquidity pools.

Moreover, Curve creates liquidity pools based on smart contracts that function as an automated market maker, rather than relying on order books (electronic documentation of a currency’s buy and sell activities). Also CRV token holders have the right to suggest and vote on the changes to the platform.

By creating liquidity pools and depositing tokens, the liquidity providers would receive favorable incentives. Every pool features a specific token pair supported in the concerned liquidity pool only. Beside, the liquidity pools can ensure better possibilities for returns and reduce impermanent loss by featuring similar assets.

Liquidity pools and Automated Market Makers (AMM) serve as major aspects for how Curve DAO works. Most important of all, the protocol helps users find out about different exchange markets to discover the most favorable fee rates.

As a result, Curve.fi can ensure that traders can improve their returns by reducing slippage. The frequency of trade on the Curve network by users serves as a good sign for the overall network. Liquidity providers could receive rewards from a portion of the trading fee paid by users.​

3. Curve DAO Token (CRV) tokenomics performance

You might wonder how Curve DeFi protocol works recently, then you need to point to a review of coinmarketcap statistics. CRV does not feature any ICO, and the only metric for its measure is through stake drop which is the method of mining CRV Token.

A user pre-mined more than 80,000 CRV tokens through a code found on Github of the Curve DAO token. Following a comprehensive review of the code, CRV DAO offered acceptance for the token launch.

At the moment, the total supply of CRV amounts to almost 3 billion tokens. Almost 5% of the tokens would help in issuing addresses to offer liquidity for the decentralized exchange. Besides, the DAO reserves of the project receive around 5% of the tokens.

In addition, the next 3% of the supply has been reserved for employees in Curve decentralized exchange. Afterwards, 30% of the supply of tokens has been reserved for employees in the Curve DeFi protocol.

Moreover, you must know that 62% of the remaining tokens are reserved for the CRV future alongside the existing liquidity providers. The Curve DAO CRV would follow an annual reduction of 2.25% in their distribution schedule by ensuring the daily distribution of almost 766,000 CRV tokens.

Surprisingly, the process of issuing the remaining CRV tokens at the existing rate might extend for the future 300 years.​

4. Curve DAO Token (CRV) price

In the above chart, the price of the Curve DAO token has stayed near the 50-day exponential moving average for the past year. In January 2021, a substantial price volume action sent the price level well above $3. As the Accumulation/Distribution indicator shows, there was a good amount of accumulation during the beginning of the last year.

The Accumulation/Distribution Indicator doesn’t signify any accumulation at the current price. But this should not be taken seriously, as there is no significant fundamental indication to back up this price sentiment.

Since the CRV is a relatively new token, the market has yet to discover its potential. When that happens, the likelihood of Curve DAO being in the top 85 highest-ranking digital coins will dramatically increase. The average trading price today is $1.11. The current market cap is $546,469,823 and 24 hour trading volume is $145,418,084.

Here is the end of the topic! Leave your comment below to raise your questions about Curve DAO Token.​

Please login or register to comment here.

Members online

Latest posts

Forum statistics

Latest member