Curve Finance Suggests Burning 10% of CRV Tokens in Response to Liquidation Crisis

Exciting news from Curve Finance – they are taking proactive steps to resolve a recent liquidation crisis that hit their CRV token market hard. Following the liquidation of significant loans, the platform’s founder, Michael Egorov, has proposed burning 10% of the total CRV supply. This bold move aims to stabilize the token price, which has plummeted by nearly 30% recently.

Exciting Development: Curve Finance Proposes 10% CRV Burn!

Michael Egorov has a revolutionary idea to tackle the recent market volatility caused by the liquidation crisis – a 10% burn of the CRV supply! By implementing this measure, Egorov hopes to maintain better control over the CRV token price and minimize the impact on users. This decision underscores the importance of maintaining market confidence and platform stability.

Curious about the latest update on Curve Finance’s liquidation risk issue? Michael Egorov shares the details!

Additionally, in a bid to support affected users and prevent further harm, Egorov has already repaid 93% of his debt and plans to settle the rest soon. To incentivize community participation, active voters on the burn proposal will receive a 3-month APY booster on all platform deposits.

Insight into Michael Egorov’s Liquidation Situation

The recent liquidation event stemmed from Egorov’s loans in stablecoins valued at $95.7 million linked to $141 million in CRV tokens. With the sudden drop in the token’s value from $0.35 to $0.23, forced liquidations cascaded across several DeFi protocols, resulting in approximately $10 million in bad debt, predominantly affecting the CRV market on lend. Curve.fi.

Discover the sequence of events leading to Michael Egorov’s liquidation due to borrowing stablecoins with CRV collateral!

Egorov’s positions were spread across five accounts on various protocols like Llamalend, UwU Lend, and Fraxlend, with liquidations totaling 20.2 million CRV on UwU Lend and 10.58 million CRV on Fraxlend. Data from Arkham, a blockchain analytics firm, suggests that additional liquidations may follow if the CRV price continues to decline.

Past Financial Hurdles Faced by Egorov

This is not the first time Egorov faced financial challenges related to his CRV investments. Last year, he navigated a major exploit on Curve with support from key DeFi industry entities to avoid liquidation. To address the current debt, Egorov received $6 million in Tether (USDT) from NextGen Venture Partner Christian Seale, enabling him to clear over $1 million in bad debt from two Llamalend accounts.

Despite these developments, the CRV token price is yet to recover, seeing a 20.30% decline with a market capitalization drop of 18% to $371,047,573. However, traders are seizing the opportunity, with a 932% surge in the 24-hour trading volume to $763,010,076 amidst the dip. Exciting times ahead!

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