With recent market turbulence, weβve hopefully shaken out the newcomers who paper-handed their way in at the top. All who remain are the new generation of future OGs and legends. Letβs go!
To newcomer frens who are observing so many protocols falling over themselves to adopt a βveβ token model, you may not be aware of the full story behind this model.
Once upon a time, only Curve had a βveβ token model. Far from being popular, everybody in the space was taking turns dumping on it. βWorst money grab dumpenomicsβ or βutter and complete trash.β
Genius is seldom appreciated in its time. In this case it took over a year (a decade in Web3 years) for protocols to jump on the bandwagon.
It was a lonely world for Curve at the beginning. Unlike several (most?) ETH projects, Curve had no VC backing. In the traditional tech industry, the underlying tech being built is often less important than whose elbows you brush. The VC-centric nature of several Ethereum protocols was a phenomenon recently discussed by unemployable, unkempt troll Jack Dorsey.
In fact, the bulk of liquidity in web3 belongs to the only protocol that didnβt get to participate in any of the VC reindeer games from the outset. VCs generally loathed the fact they did not get preferential access to Curve, instead having to ape through the front door with the rest of the peasants. Theyβve held a grudge about this, and the petty snubs against Curve continue even to this day.
So inspired was the Egorov StableSwap invariant that Curve would prove all the haters wrong simply by the exceptional nature of their pure mathematics. Curve stomped through all competition, becoming the largest source of liquidity in all DeFi by an overwhelming margin. Crying VCs tried to push a βliquidityβs not so importantβ narrative, but capital efficiency begs to differ.
Not only has Curve become tops in DeFi, but suddenly everybodyβs taking a second look at the much derided βveβ locking model and starting to appreciate its brilliance. The token came far later than the initial Curve liquidity pools. The βveβ model was complex and confusing, and the emissions schedule was unorthodox. Today, people are coming around to the brilliance.
Whatβs so inspired about βveβ token design? Thereβs a number of interesting properties, but at the most basic level itβs locked up a ton of supply for what is a relative lifetime in DeFi.
Do protocols care about this? Or do they just want a piece of that Convex magic. Ever since Convex announced its partnership with FRAX, a lot of tokens are realizing that a βveβ model is a prerequisite to most easily integrate with Convex.
For users looking for an in-depth analysis of the βveβ model, consult with DeFiβs Chief Alpha Officer (CΞ±O), whoβs been releasing a series of articles on the brilliance of the subject.
If youβre human, youβre probably a fan of pattern recognition. One possible pattern to chew on: historically, things Curve do prove to be brilliant in a few years time. Therefore, you might be wondering what Curve is doing right now, today, that people will be talking about in 2023.
Not too sure myself, it seems like Curveβs just been preoccupied putting together and launching v2 poolsβ¦
Is there any information on who was responsible for coming up with Curve tokenomics? Would love to hear an interview on that to see what other ideas were discussed and ultimately canned, if any.