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Curve Finance is just a year old as it was launched in the same month last year that is January 2020 but it has made its impact in the decentralized finance market already. It is already regarded as one of the leading DEX platforms which were made by the Russian Physicist Michael Egorov.
In this article, we will read about this new leading decentralized exchange and explore all the aspects of the same.
Table of contents
|Legal Name||Curve Finance|
|CEO||Michael Egorov (Russian Physicist)|
|Trading Fees||Liquidity provider fee – 0.04%|
|Supported Cryptos||USDC, DAI, TUSD, USDT, BUSD, PAX, renBTC, and others.|
|Trading Options||Swap, Liquidity Providers – Liquidity mining pool|
What is Curve Finance?
Curve Finance is a platform built on the cryptocurrency – Ethereum. It is a decentralized finance exchange where you can earn by providing liquidity using cryptocurrency. You can also swap your cryptocurrency on this platform with other cryptocurrencies.
Curve finance provides an interest component on the deposit you have with their exchange. Supposedly, you have exchanged ETH for USDC, and retain the later in the wallet, then you will earn interest on the same. It is a platform for liquidity providers as well as crypto traders.
It established itself as a decentralized autonomous organization (DAO) by releasing its token called CRV.
Curve finance has a series of pools. These pools are having assets such as stable coins that are there in the first three pools out of the seven. The remaining are having wrapped Bitcoin versions like renBTC, wBTC, and others. It provides a huge return on the deposit you have with the Curve finance exchange.
Curve Finance Features
The features which make Curve Finance special are as follows –
- Exceptionally high return: The first thing that makes Curve finance one of the best in the decentralized market is its interest return on the deposit. It pays up to 300% return on your deposit which is a rare sight in the market. It pays on the deposit you have with the exchange in cryptocurrency.
- Great Security and safety: The platform is highly secure. It has way better encryption than many other DeFi exchanges and thus it keeps your funds secure and your transactions are well guarded.
- Minimal Temporary Losses: Curve Finance swaps your crypto with stablecoins. This is a direct exchange and thus the process is smooth and involves no double exchange. This saves time and reduces the loss of value.
- Pools: Curve Finance has multiple pools of assets. Here assets mean cryptocurrencies. Each pool has different assets and you can use any of them to provide liquidity. The liquidity providers gain interest from the same as well.
- Mergers: On a decentralized exchange like Curve Finance, your risk is lowered as there are various assets to trade from. You can diversify \your investment and mitigate the risk.
- Algorithm: Curve’s algorithm is different from other Uniswap exchanges. It focuses on the minimum spillage while the others look for maximizing the liquidity. This helps the bulk traders save more with Curve.
Curve Finance Fees and Limits
At present, Curve Finance is providing 0.04% of the transaction value to the liquidity providers. There are no other fees like admin fees or others as of now. However, later on, DAO will decide the same.
So, now, whatever transaction (swaps) takes place on the exchange, 0.04% of it goes to the person who is providing the liquidity for the exchange to happen.
Currencies supported by Curve Finance
There are many currencies that Curve Finance Support and the crucial ones are –
- different BTC pairs
How to provide liquidity on Curve finance?
To provide liquidity on Curve Finance you need to –
- Register yourself on Curve finance
- You will get the user id and password for the same
- You can deposit using plain stablecoins like DAI, USDT, USDC, BUSD, and others.
- These will get converted into cTokens or yTokens.
- If you already have cTokens or yTokens, then you can click on ‘Deposit Wrapped’ button and deposit the same.
- You can also use wrapped Bitcoins to deposit in Curve Finance like renBTC, WBTC and others.
How to Link your Wallet?
The process of linking your wallet with Curve Financed is really easy.
- Firstly you need to click on the options ‘Connect Wallet’ on the Curve Finance website.
- Then a dialogue box will open with the different wallets that you can connect with Curve Finance.
- You can connect any one of these –
- MetaMast is one of the best options to connect.
- You can click on the wallet you want to connect to, and then you can access the same from the Curve Finance website.
- Then you can trade or swap currencies and also deposit.
How to swap cryptocurrency on Curve Finance exchange?
To swap or trade the cryptocurrency on Curve Finance Exchange, you need to –
- Visit the Curve Finance Website
- Connect the wallet like MetaMask or WalletConnect and others.
- Select the cryptocurrency you want to swap on both sides and click on exchange.
- You can also click on Sell if you want to sell your cryptocurrencies.
- Your wallet will get debited by the new currency and you will get a notification of the same.
- Once you get that notification, it means the transaction is successful.
- Multiples pools
- Direct transaction
- Highly secure network
- Huge return on deposits
- Way better algorithms
- Minimum spillage
- Pools are unstable
- Entry and trading fees are higher
To conclude, we can say, Curve Finance is already leading the way in the decentralized finance market. It is developed using a different algorithm which sets it apart from many other decentralized exchanges as it helps the traders and liquidity providers earn more by minimum spillage. Curve Finance has direct transaction options that further help the traders and many such great features.
It is the token released by Curve Finance. It is the base coin of this exchange. You can earn it by depositing or trading on this exchange.
Though the risks are low in this exchange, there are still chances of incurring impermanent losses. However, this risk is common on all similar platforms.
On Curve Finance, the time taken for swapping the currencies is negligible. It happens within a blink of an eye.
Yes, it is absolutely a safe and secure platform. Moreover, it has the feature of a single transaction which further lowers the time for hackers to attack the system.
The Trail of Bits audits the smart contracts of Curve Finance.