May 12, 2021: Doggies Choke Chains 🦮⛓️
Curve Releases Cross-Chain Proposal to Combat $SHIB Congestion
What’s better than Curve? How about Curve everywhere!
Curve laid out its plan to the governance forum to increase support for Curve across multiple chains. Of course, demand for $CRV token is intense because it provides the keys to the citadel. Yet this was a bit tricky to square with issues like the hard-coded $CRV inflation schedule and risks of chain failure.
The elegant solution was to port Curve’s reward gauges to other chains, and allow for a veCRV vote on assigning $CRV off-chain which could be recovered if the chain died. The $CRV remains printed by the minter on Ethereum, and will pipe it to other chains based on gauge weight. The $CRV is then claimed by users on its respective sidechain.
Users were predictably elated by the news.
Curve needed to generate a mechanism to keep up with cross-chain activity. DeFi activity is rapidly spreading to chains like Polygon, Fantom, and BSC. Scammers already exploited the hope for more Curve rewards with the FroYo heist. Although Curve is Ethereum-first, the massive popularity of Ethereum is making it unaffordable for all but whales.
Indeed, since Monday, average gas prices have been above 200 gwei and occasionally scraped 400. At first some people attributed this to the sudden popularity of $SHIB, but gas prices have remained high even though demand for $SHIB has cooled off. Of course, there’s always more dogs being adopted…
Compounding the pocketbook pain is the rising price of Ethereum, which has soared above $4300 after opening the year at a bargain basement price of $730. ETH has also run up rapidly against BTC to the chagrin of Taproot true believers, jumping from .03 to nearly .08 since the start of the year with little sign of slowdown.
While this is great news for ETH holders, it means that in practice ETH transactions are becoming unaffordable.
While EIP-1559 will doubtless improve the landscape, the demand for Ethereum is so substantial that the solution for most users will be to offload activity onto L2.
Thankfully Curve’s proposal, along with other solutions architected by other DeFi sites, is laying the infrastructure to allow ape activity to proceed apace. Users are psyching themselves up for altseason/DeFi Summer 2.0. Thanks to the fast work of developers, this party may occur across several chains, with any and all dogs allowed!
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 $CRV maximalist, owns $BTC + $ETH, no $SHIB.