Define the impact of the curve on DeFi from a token management and economy perspective

1. Content:

Separation of Convex and VeCRV

all. CvxCRV = VeCRV yield

. vlCVX = VeCRV-gov

vs. Wealth: Not a pure separation.

2. Fight

a. Wealth v0: Direct stimulus for mining lakes

b.Cronje's pot.crv [veCRV gray]

c. Botium

3. Do it: ideas and results

a. sdveCRV Liquidity Scheme: Total failure and total failure

b. CvxCRV liquidity plan: start now

vs. Spelling case / MIM

D. sdveCRV vs cvxCRV

From the early days of Curve Finance and the launch of the CRV token, we have waited, pondered and pondered the consequences of the CRV war. Now, with the announcement of Convex, Bribe.crv and Votium, everything is going fast. You can now buy VeCRV Vote! Let's see how this affects Curve and DeFi in general.

Let’s see now. The question is very simple and clear.

1. In terms of total deposit costs, Curve is the largest decentralized DeFi exchange.

2. CRV tokens provide 1 / display value / 2 / voting rules that may affect the future supply of the CRV.

3. => The management of several CRV voting rules facilitates the installation of a CRV pool because it can vote for several CRV income in this pool.

However, like DeFi, not everything is easy and the problem lies in the details. Understanding the challenges of the CRV war requires a good understanding of the different tools developed by it, which can help determine the impact of the influence strategies displayed on the various Curve projects.

Convex separation and VeCRV

Before identifying the battlefield, the different equipment used in this CRV war, it is necessary to dig deep into one of them, the convex space. I have discussed this in this blog and explained the flywheel effect of Convex with CvxCRV.

The intersection of the convex and the curve is just one factor that goes far beyond the CvxCRV. In fact, Convex can best be described as a management and revenue decision of VeCRV.

CvxCRV = VeCRV - Yield

CvxCRV is related to VeCRV which is convex and is permanently closed, but the funds available in CvxCRV / CRV allow depositors to close their trades.

In terms of management, CvxCRV has lost all of its functionality. VeCRV owners can vote for devices (CRV issues) and vote management. CvxCRV owners have nothing better than recovery.

However, the rewards have increased compared to VeCRV alone.

1. Return in 3pool tokens, which are part of the cost paid by Curve in exactly the same way as VeCRV.

2. CRV income (10% of all CRVs developed by Convex are shared by all CvxCRV lenders).

3. The output of CLC is almost identical.

4. Ability to drop such as Ellipsis.

Compared to VeCRV, CvxCRV is easier to communicate. Functionality management was lost (-> vlCVX), but recovery was very efficient and multilingual.

vlCVX = VeCRV - Government

Convex, on the other hand, has another curved detail, the CVX symbol. In fact, all CLCs include VeCRV voting rights (in CvxCRV).

To support this, applicants must “vote” their CLC in vlCVX. It is closed for 16 weeks, 3 days, so you can access the management features. Currently, vlCVX is the most useful way to increase the voting power of the curve.

Besides increasing CLC income to affect the curve, the risk is lower than that of VeCRV. For comparison, the CRV is believed to have been closed for 4 years. For short contracts, the difference is a significant advantage for vlCVX.

Warning

vlCVX has its drawbacks. Depositors will be penalized if tokens remain inactive for more than 4 weeks after the first 16 weeks of closing.

For a more detailed analysis of CLC representative income and the voting options involved, feel free to read this article which provides more detailed information.

◎ Voting efficiency estimation by vlCVX

Wealth: Not a pure separation.

The situation was clear, but it did not last long. In fact, the first indication is that vlCVX has no income. The owners of vlCVX share 6% of all CRVs developed by Convex in the form of CvxCRV.

In addition, this will not be the only gift vlCVX owners may receive, and management may offer significant rewards through bribes (purchase of tickets).

Other activities encourage voting on a note for a pool instruction. For example, Alchemix will benefit from its ALCX markup, and anyone who votes to increase CRV distribution to the AlUSD pool using VeCRV will receive a weekly reward.

In the long term, the initial distribution of the convex planes is the most unfair. Currently, the efficiency of cvxCRV is around 60%, while CVX is only 15%. But by adding a bribe to the equation, it's not impossible that the returns from vlCVX are much higher than those from cvxCRV.

combat

"Wealth" is an important part of the governance balance of the curve. However, before we dive into it, we need to look at the trajectory velocity (veCRV), which means all the changes.

VeCRV is obtained by stopping CRV for up to 4 years. The longer the downtime, the closer the VeCRV / CRV ratio is to 1. Locks, like voting rules, will build up slowly over time.

This is why the vaults created in VeCRV work with 4 years of stable operation. This is usually a “refresh” lock to always keep it as close to maximum voting capacity as possible.

◎ Ecosystem monitoring based on veCRV

Wealth v0: Direct stimulus for mining lakes

Before talking about corruption, it should be noted that important information is available from the start of the curve. As additional support for the data provider (on top of CRV), Synthetix pioneered SNX liquidity extraction in its sUSD pool system.

Direct payment can be combined or encouraged to pay bribes. For example, below we will see how MIMs can achieve more performance by sharing their incentive and bribe funds (after the initial phase without bribes).

Pot-de-vin de Cronje.crv [veCRV gray]

As you can see, “bribes” are purchases made at VeCRV polling stations and paid for every Friday (voting day is decided).

However, just like many machines that can interact with VeCRV, there are also a lot of rich features, so we'll start with the first one. http://bribe.crv.finance/

The default unit is VeCRV. Bribe.crv is a simple interface that allows you to write various tutorials and collect bribes. The vote is taken directly on the Curve.

After an amazing start, the services were used more and more, and now many jobs are corrupt. The results for the first few weeks have been fantastic and will still be visible if this continues. For example, I voted for the MIM mining pool and accepted SPELL tokens on bribes in 5 weeks, and my VeCRV (/ current price) got around 10% back.

I will come back to the results below.

Botium [siv vlCVX]

The other option is Votium, its base unit is vlCVX, so these two services are more competitive than the competition.

Since Votium is newer, bribes are less. On the other hand, Votium already controls the power vote well above 8 million CVX or 122 million VeCRV.

This process can be done much more than bribe.crv, as depositors can vote every week and submit to Votium to collect bribes.

Even with the most active representatives, depositors can still manage and vote directly on the pool in the snapshot (-> no fuel costs). The system is therefore changing more than bribe.crv in this regard.

Other corruption services have also been developed and will be developed in the future. Rich gaming so far has focused on CRV, but Paladin, for example, plans to offer similar processes to other standards.

Posted in Action: Concepts and keys

The principle of this concept is very heavy, but understanding it is important. To focus a little more, let's come back to the performance with the example.

Spelling case / MIM

Abracadabra is a software development company that provides custom products for a wide range of assets, including assets such as xSUSHI and cvx3pool.

Just like Maker created the DAI, Abracadabra created solid coins (US dollars) called MIM. Therefore, the resources and income available in MIM are critical to the success of the platform.

This is why Abracadabra receives various types of bribes directly or indirectly on the curve.

1. Start with SPELL boost (right tokens) from the Curve / MIM pool.

2. When bribe.crv arrives, part of the gift is returned in the form of a bribe, thus distributed to the owners of the veCRV who have voted for the MIM scale.

3. Now that vlCVX is out, we decide to invest in it.

A few weeks later, the MIM pool erupted at all levels of the curve.

The results of the CRV have been excellent within a few weeks.

This attracts cash and volume and reduces cash flow slightly, but increases the ability to increase the cash pool.

This period made MIM the fifth biggest attraction curve in packaging with the best volume / TVL ratio.

C Overview of the highest mining lake in Curve (volume)

In addition, the pool is now well balanced and dense (over $ 700 million in total drainage). The Abracadabra example is very well documented because it shows the accuracy of abstractions based on VeCRV. Without having to increase its total investment, Abracadabra can attract more commercial products than direct support from SPELL.

Therefore, we understand that DeFi operations that use the process of veCRV, cvxCRV and vlCVX have a very good scope (economic and political) of work which is not yet fully understood.

sdveCRV vs cvxCRV

In fact, I now believe that being able to understand the curve and benefit from its management is an important and necessary skill for most DeFi operations, especially those of the stable plane.

You don't have to trust me. Let's compare two project implementations that actually have similar issues. cvxCRV (powered by Convex) and sdveCRV (powered by StakeDAO) are two abstractions based on ideas of liquidity, for example veCRV.

The situation is similar, but there are important differences.

1. Let us first predict that the number of CRVs managed by Convex is more than 30 times greater than that of Mand Mand CRVs managed by Stake (102 million against 3 million).

2. There is also a serious problem with the sdveCRV connection. 1 sdveCRV ~ = 0.5 CRV.

sdveCRV / CRV exchange

sdveCRV Liquidity Scheme: Total failure and total failure

Let's continue our test. In the beginning, the performance of sdveCRV was for ETH like Yearn. From Convex, the Council has been trying to make sdveCRV attractive.

However, the team didn't take the time to identify the situation and rushed to the Curve, one of the greatest diets in history.

Add control equipment (= CRV support) to the surveys after creating the sdveCRV / CRV pool at Curve Factory. Not only is the vote rejected, but the way the sdveCRV pool is unique and dangerous for depositors.

In fact, the value A (amplification parameter) of the mining pool is fixed at 200. This is the typical value for an asset which follows the same attachment, but if one asset is worth twice the value of the others, you will deceive.

◎ Comparison of curved swimming pools (factory) sdvecrv and MIM

To give you an idea, even the large MIM pool (7000 times the water level of the sdveCRV pond) never reached a value of 200 (119 current, large growth).

Therefore, it is clear that not only did Stake not fix the sdveCRV issue, but this process also made the team understand the difficulties of Curve / Convex.

In order for sdveCRV to reconnect and improve its performance, several tasks must be performed:

Look at the pools

Direct support for Ikegami SDT?

SDT penalties in the pond?

After completing these steps, the team will be able to get a different CRV seat in that pool, but not before. The current situation therefore seems extremely costly to die. There is no way out unless the SDT card is heated (or more).

CvxCRV liquidity plan: start now

Conversely, cvxCRV's liquidity plan reflects the efficiency of the process. Initially (to date) large pools of cvxCRV were opposed to Sushiswap's CRV.

This situation is not justified. Sushi is not the best choice for the refinement of a treasure that follows the same ankle. So when Curve launched its factory pool (V2), the cvxCRV / CRV pool was the first to appear.

(where A is 50 and cvxCRV may contain better connections than sdveCRV ...)

◎ cvxCRV / CRV not

Without the support of Convex or Curve, the mining pool saw more traffic from DEX aggregators like Paraswap. Soon it was decided to add a CRV counter. The lake can be cultivated directly from Convex.

The challenges are still a bit inconsistent (which has a lot to do with CRV and has become less so ...). However, even though it paved the way for cvxCRV / CRV SLP pools, revenues are still low. part.

Therefore

We hope this article has helped you understand the complexities of expanding the veCRV ecosystem and its implications for CRV combat.

Before I close, I want to tell you that, as always, the alpha value is at its lowest. If you've read this article, feel free to post some good results focused on other projects. I think this will inspire you!

As I often say, that alone is not enough. Curve is not only DeFi's most important DEX, but also the most recent standard in token administration and trading. Even if you are not happy with Curve / Convex, it is important to fully understand this process to consider what is happening in DeFi ... Hope this article has helped you!