After the CRV liquidation, has CVX become the top choice for whales to buy at the bottom?

Last week, DeFi ushered in the biggest turning point of this cycle. CRV continued to fall to a low of $0.219, and the lending positions of founder Michael Egorov were gradually liquidated. According to Arkham statistics, in less than half a day, all of Michael's loan positions in 5 agreements were liquidated, worth $140 million.

Related reading: " The founder was finally liquidated, and the Curve flywheel was completely bankrupt? "

Although the price of CRV has rebounded, the most eye-catching is CVX. On June 17, according to Binance market data, CVX briefly rose to $4.66 and then fell back, up more than 90% in 24 hours.

Is CVX the preferred target for whales to buy at the bottom?

Michael Egorov said in an interview with CoinDesk that the liquidation was caused by the vulnerability of UwU Lend. But unlike in the past, when CRV fell, Michael did not cover his position in time, but allowed the chain liquidation to occur. Because Michael's position was too large, the market could not handle it, and it resulted in 10 million bad debts.

In order to eliminate the adverse effects of bad debt accumulation on the market as soon as possible, on the evening of June 13, Christian, co-founder of the crypto fund NDV and NFT giant whale, posted on social media that he had obtained 30 million CRV from Michael.

In addition to helping Michael repay the loan, Christian also stated that Curve was under pressure before because Michael obtained liquidity in advance that ordinary project parties could not get. Now that the liquidation is completed, it means that Michael has finally sold out the liquidity in his hands. Christian believes that "there will be no secondary market selling pressure at least before 2028."

This also means that now is a good time to buy CRV at the bottom, and the market performance is indeed the case. According to Binance platform data, when CRV hit the bottom of $0.219, the trading volume of the CRV/USDT spot trading pair reached 463 million in just 1 hour (with a trading volume of $111.5 million), setting a record high for the trading pair. At the same time, CRV also topped the Smart Money 24-hour inflow list for two consecutive days.

As the largest stablecoin exchange protocol on Ethereum, most DeFi relies on Curve, and the Curve protocol is still valid and immutable. Then, we have reason to speculate that Michael's liquidation may mark the beginning of DeFi's return.

On June 17, Curve Finance officially announced that the funds flowing into veCRV last week were 6 times the inflation of that week. These inflows include direct lock-ups, as well as lock-ups through Convex Finance, Stake DAO, and Yearn. This is the highest weekly inflow of CRV lock-ups in recent years.

As one of the three major protocols that started the Curve War, Convex Finance TVL reached $1.316 billion at the time of writing, accounting for more than half of Curve ($2.285 billion), which also means that Convex chips are more concentrated, and the whales naturally set their sights on Convex Finance.

In addition to Christian mentioned above, Kennel Capital member Zoomer Oracle also clearly stated that he bought CVX at 2.05. Zoomer Oracle believes that CRV/CVX is undervalued, and "Convex is the beta of Curve, with a simple 5x potential."

In addition to CVX, what other targets are there in the Curve ecosystem?

Michael's loan is gone, the market no longer has PTSD, bad debts have been cleared, and DeFi may have ushered in good news.

In addition to the various DeFi protocols in Curve War, such as Stake DAO, Yearn Finance, Olympus, and Frax, the gameplay of each protocol can be seen in " Curve War upgrades the CVX battle, and the exciting power struggle continues ". Another application scenario of the Curve protocol is to support stablecoin projects through Curve 3pool (DAI/USDC/USDT fund pool).

According to Curve data, the current 3pool transaction volume and TVL data are less than one million, which means that some more mainstream stablecoins are less likely to adopt Curve transactions, but the liquidity of the Curve protocol itself can still support small stablecoin projects.

At present, the modular market is gradually emerging, and modularization will lead to an increase in chains. In order for each chain to continue to develop application scenarios, stablecoins may become a necessity. Then, Curve 3pool can provide certain liquidity to these stablecoins, especially algorithmic stablecoins. Of course, since Curve 3pool uses CRV as a distribution reward, this requires CRV itself to have sufficient value.

After the liquidation, Michael said that this incident may help strengthen Curve's security measures and loan mechanisms, and may create better services for users in the coming months. Whether this can really make the Curve flywheel take off again, it will take time to judge.

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