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Curve Stablecoin: A New Approach to Stablecoin Design
Osgur Murphy O Kane
Key Takeaways
8 min read
  • crvUSD is arguably one of the most interesting proposed innovations in DeFi this year. It is taking a fresh approach to stablecoin design that includes; a unique AMM for collateralization, staggered liquidations and deliquidations within a specified price range, and an algorithmic component to help maintain price stability.
  • Its liquidation/deliquidation design is designed to enable efficient liquidations and greatly reduce the risk of bad debt compared to typical borrow/lend protocols. It will be very interesting to see how it performs in practice.


Curve is among a number of well-established DeFi protocols commonly referred to as bluechips: these include Aave, Maker, Compound, and Uniswap. Of these, Maker demonstrated the potential for a native stablecoin to drive revenue for a protocol. As a result, Aave announced earlier this year that it will also launch a USD stablecoin called GHO. See Nansen’s report here covering GHO. This was shortly followed by rumours that Curve was going to enter the stablecoin game. While Aave’s stablecoin is similar in many respects to other overcollateralized stablecoins, Curve has taken a new approach which is described in this...