June 23, 2022: Money to Burn 💸🔥
Curve finds a spare $4M, plus $CVX, $SDT, $DPX, $FRAX, CLEver Airdrop
Uh oh! Another large mistake at a leading DeFi protocol.
In this case it hit the normally immaculate Curve Finance, to the tune of $4MM.
The good news is, even Curve’s “mistakes” are chaddish. This bug redounds to flywheelers’ benefit, to the tune of a $4MM bonus.
The only people who suffer are the hapless Curve doomsayers. It must be exhausting trying to summon a death spiral, but seeing all the evidence continually pile up against you.
How often does anybody just stumble into an extra $4 milly?
You can see the fees idling on-chain here, easy to collect, but only possible through a presumably uncontroversial DAO vote.
For those curious how such a large amount of value can go unnoticed, the process of collecting fees is a manual grind. Initially it was quite simple when Curve had just a few pools, but as the activity has exploded to hundreds of pools across a dozen chains. Today it’s a sprawling leviathan to be tamed each week, a horrendous process in which it’s easy to overlook some steps. Fortunately the worst that happens is some money sits idle.
Should this proposal pass, we’ll be looking at record Curve fees for the week.
What’s the opposite of a death spiral? Perhaps Curve is afflicted by a money vortex?
Lockening
As we grind out the bear market, it seems users still have an appetite for lockening.
Since February there’s been more locked CRV than free floating CRV, and the status quo has held.
By far this has been heavily thanks to Convex’s industrial farm-and-lock operations.
Note also the success of StakeDAO’s liquid lockers, which has caused their share of locked CRV to tick upwards in recent weeks.
For the upcoming week, much attention will be paid to the upcoming Convex unlocks on June 30. This class of users locked before cascading CeFi contagion crippled prices across crypto.
If you’re a jittery ape who locked near $40 and the prices collapse to $4, what’s the thought process? Sell at 90% loss? Or relock and hope to earn back from cash flow? We’ll find out soon.
Other options may exist for users who want to keep their CVX but not relock it. We note that $CVX now has a bit more utility across the space than previously:
Frax
The much anticipated FRAXBP proposal is working its way through the governance process.
FRAX has an exciting few weeks ahead. Not content to let Curve splash a bonus few million around its ecosystem, the FRAX team is running their own $20MM buyback to snap up its $FXS governance token.
We’re also expecting the launch of Fraxlend in the upcoming weeks.
1Inch also recently integrated the Fraxswap protocol. We saw how aggregator integrations juiced Synthetix this week, so such deepening integrations are exactly what we want to see during the bear.
The FRAX veCRV whitelist is also approaching in the next few weeks, opening up further possibilities for the exciting protocol.
As you can see, plenty of reason why Frax is turning heads.
Dopex
The Dopex ecosystem continues to build. We know their innovation is already reshaping the Curve Wars. The team this week launched their veDPX.
Good threads on what this all means.
Blessed are the teams building the bear, for they shall be wealthy in the bull to come.
CLever Airdrop
Finally, amidst the Aladdin DAO Concentrator Airdrop frenzy, we also see news of the CLever airdrop!
Disclaimers! Author has direct or indirect exposure to all assets in today’s newsletter
If one had to choose to hold *only* one of CVX or CRV for the next 5 years, which is the better hold?