DeFi
Founder liquidations shake the DeFi world
The DeFi token CRV has been placed in the spotlight after significant liquidations linked to its founder, Michael Egorov. Reports on its borrowing of stablecoins collateralized by CRV the tokens triggered a cascade of liquidations affecting its wallets and other members of the ecosystem. Here is a detailed breakdown of key indicators to watch as the situation evolves.
Following this news, trading volume reached an all-time high since December 2021. Currently, market sentiment is leaning heavily towards downward pressure with widespread FUD. The level of discourse about the token is also the highest so far.
The number of unique addresses interacting on the network and the number of new addresses created are both at their highest level since a similar price drop occurred in late July/early August 2023. This indicates increased interest despite the current unrest.
Another key metric is “Daily Active Address Deposits,” which measures the proportion of active deposits to the total amount of active addresses. Currently it stands at 35.5%, the highest since August 2021.
In terms of whale holding, the number of tokens held by non-traded whales decreased significantly from 1.34 billion to 441 million coins on June 5, signaling the exit of large holders. Despite Curve’s uncertain future, there is a trend toward major consolidation. Three wallets containing over 100 million CRV tokens held half the supply and added another 4.89% to the supply from smaller wallets.
Additionally, the 30-day MVRV (market to realized value) of short-term swing traders stands at a reasonable -2%. However, addresses active in the last 365 days are seeing a “juicy” -35% decline, the lowest since September 2023, indicating significant unrealized losses for long-term holders.
The founder of CRV reaffirms his commitment to the liquidation crisis
In the midst of these liquidations Curve founder Michael Egorov addressed the community, reaffirming his dedication to the project. Egorov aims to build a system that automatically incentivizes crvUSD supply sinks to improve the stability and utility of crvUSD, thereby contributing to the overall health of the Curve ecosystem.
In case anyone is wondering, I am more committed than ever to building Curve. The priorities are: – Apply observations to ensure that lending/borrowing products are the safest in the industry under all market conditions; – Produce educational work for arbitrage traders to teach them how to do liquidations (yes, they need it!); – Make sure crvUSD supply sinks are _automatically_ incentivized by the system.