Earning On Stable Coins With Curve Finance

in LeoFinance3 months ago (edited)

The DE-Fi space is evolving faster than any of us can keep our eye on. Unfortunately, you can't keep chasing every project, and you need to pick your poison. The more you stretch yourself, the more you open yourself up to risk in this space, since all these platforms are deploying code all the time to remain competitive.

This is just my way of giving you all a friendly warning that these tools are super high risk and while the APR sounds great, it could be up in smoke, and you could be left with zero.

While Uniswap, and Sushiswap and all these other DEX's are the darlings of the industry, other projects are looking at whats going on in De-FI and trying to solve certain niche problems. I recently came across a project called Curve Finance, that has an interesting use case.

What is Curve Finance?

Curve is a decentralised exchange built on the Ethereum blockchain with a front end that looks like it was built in 1998, during the dial-up dot com boom. The Curve platform was launched in January 2020, so it's fairly new, and it's actually been making waves in the de-fi sector.

The platform has a decentralised liquidity pool on Ethereum designed for extremely efficient stablecoin trading. Curve allows users to trade between stablecoins with low slippage using their low fee algorithm designed specifically for stablecoins and earning fees.

Tokens provided for the liquidity pools are also supplied to the Compound protocol or iearn.finance and to generate more income for liquidity providers.

Currently, there 7 Curve pools:

  • Compound, PAX, Y, BUSD, sUSD, ren, and sBTC which support swaps for A variety of stablecoins and assets.

Curve also has its a native token known as CRV, which is currently valued at $0.50 having tanked from its $53 high in August. You can find out more about it on its @coingecko listing here

You can visit the site here: https://www.curve.fi/


Why get involved in curve

If you know anything about stable coins both algorithmic and backed, you'll know that it can easily be overbought on a certain exchange and can drive up the price and likewise, if oversold the sales can break the peg.

Curve aims to provide stability by collecting a basket of stable coins in a liquidity pool and arbitrage the price changes between stable coins. To help maintain pegs and earn fees for LP providers in the process.

You can view the various pools on the site which are mixed with different baskets, depending on the basket and the limitations of liquidity on a certain basket, you can get a higher return for providing liquidity in certain pools.

Current APY ranges between 0.24% to 7.80%

You'll have to view the pools that support your stable coin and then pick the one you feel has a return you are happy with providing. You can provide one type fo stable coin or a range of them, that's up to you.

The curve exchange has 8 coins and 23 pairs with a current trading volume of $54,909,508

Side note: It would be cool if we could have wHBD/HBD live on an application like curve to help maintain its peg and earn some fees for helping keep the coin at its one dollar level

My impressions of Curve

Since its a DEX, you'll have to log in with wallet like Meta mask, but it also supports Tezor and Ledger wallet access which I thought was pretty cool.

I added a few USDT I had left in my meta mask to earn a return on it, but I also bought the CURVE token which you can also stake for an additional boost.

The CRV token has a max supply of 3,303,030,299, but its current supply is 111,098,100 and has a market cap of $54,751,77

I think the coin has some upside having been obliterated from its all-time high, so I feel I am picking up this coin relatively cheap, with $100 buy-in.

Yet again adding to my list of coins to watch, bleh, but hey the things we do for money am I right? I totally get if

MEGA DISCLAIMER: This is NOT financial advice, don't get me wrong I am willing to lose every penny on this trade and having fun messing around with new projects.

Have your say

What do you good people of HIVE think?

So have at it my Jessies! If you don't have something to comment, comment "I am a Jessie."

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Posted Using LeoFinance Beta


I get that it is fully decentralised and that has its advantages and disadvantages but these returns seem low for stablecoins if you see what the cefi platforms are providing

Posted Using LeoFinance Beta

Well CEFI have backing so they already start off with liquidity and are willing to take a knock to attract investors where as this platform is still in the phase of establishing liquidity providers if you offered to high returns you’d kill the pool

I’m sure they’ll work out the return algorithm as they have more data I mean it’s less than a year old and stable coin arbitrage doesn’t have that much margin

I think as they connect with other platforms it could provide more liquidity and the service can show some decent returns

This is really quite interesting I would say even in the life we live in is also a risk so I believe taking risk in the block chain can bring good result as well

Posted Using LeoFinance Beta

There’s always risk in everything we do but this is open source and the here can be bugs which is why I am not going to risk a lot of capital in it,

I do like the concept I think it’s something we need right now with stable coin pegs always being a problem you can see that with HBD

I guess by design HBD is not a stable coin though it almost peg to $1.

Posted Using LeoFinance Beta

Yeah it’s because it depends too much on the internal market and doesn’t have much external listings to arbitrage and keep it stable as well as getting into basket LPs like Curve which do help

Curve has been great in smoothing out price inefficiencies between stablecoins and is a great platform to arbitrage of changes in stablecoin prices.