April 9, 2021: Synth $CRV Incoming 🌠🦾
April 9, 2021: Synth $CRV Incoming 🌠🦾
Synthetix poised to launch sCRV token
Go ahead and grab a sip of coffee.
Now just imagine the spit takes when we inevitably see a casual $1B transaction…
Curve remains the dom site in DeFi, and a recently passed Synthetix proposal could extend this dominance. Barring a recount, SIP-107 to add a $CRV synth has passed.
SIP-107 was proposed in January of this year and looks to provide a variety of benefits to all parties. Curve chief @Michwill pointed to “large buyers express a desire for an on-chain method of acquiring $CRV.” The existence of sCRV would allow Curve’s token to trade natively within the Synthetix ecosystem.
The author of the proposal, @kree2, authored a detailed analysis of the situation:
Currently synthswaps on Curve are mostly going in one direction from stablecoins/BTC into Synthetix that are then mostly being used to farm on Curve’s pools as sETH, sEUR or sBTC. This creates a pool imbalance that can disrupt the sUSD peg as sUSD is first bought from the sUSD pool then converted to the relevant synth. This reduces the balance of sUSD in the curve pool.
Adding sCRV should help this imbalance as it is likely people will wish to go from CRV > sCRV > sUSD > any stablecoin . This action will deposit sUSD in the curve pool and remove another stablecoin from it, helping the peg. The long term fix for this is to have a variety of sPools on Curve to even out directions and promote lots of different arbitrage.
The existence of the Synthetix token could also enable a Curve CRV pool, a significantly more meta pool than the existing metapools.
The Curve proposal was just one of the SIPs passed over at the happening Synthetix governance boards.
Also coming soon to Synthetix’s Kwenta exchange soon is synths for $1INCH and $THOR. Also of interest is that Synthetix will be diversifying its oracles, now combining both Chainlink and Keep3r TWAP oracles. This is particularly interesting in that Unit Protocol has been down for some days as a result of issues with Keep3r.
Synthetix is of course crucial to the Curve ecosystem. Not only does Synthetix power Curve’s cross-asset transactions, but two of the top five pools by volume are Synth pools.
In return, Curve is the top volume source for Synthetix
Thanks to the Curve + Synthetix symbiosis, we may be getting our $1 billion dollar coffee spit take sooner than we think!
For more info, check our live market data at https://curvemarketcap.com/ or our subscribe to our daily newsletter at https://curve.substack.com/. Nothing in our newsletter can be construed as financial advice. Author is a Curve maximalist, but sadly no Synth.