Crypto news: the founder of Curve abandons Aave

Curve founder Michael Egorov has completely closed his debt position on the crypto protocol Aave. 

After this de facto operation he is no longer active on the famous decentralized lending platform. 

Curve’s crypto position: the closure of the debt position on Aave

As Lookonchain reveals, in order to fully close his still-open debt position on Aave, Egorov had to borrow more than ten million crvUSD and exchange them into USDT. 

In order to obtain this loan on Silo, he had to pledge 68 million CRV tokens, with a total value of more than $35 million. 

Now Egorov on Aave has nothing left, while he has debts totaling more than $42 million on four other platforms, secured by as much as nearly 254 million CRV tokens as collateral (worth $132.5 million). 

The Curve Finance protocol

Curve Finance is itself a decentralized finance protocol, with currently more than $2 billion in TVLs. Aave, on the other hand, has a much higher TVL, exceeding $4.6 billion. 

It is a DEX in some ways similar to Uniswap, so much so that it has been able to rival the latter in the past. 

Now, however, on Uniswap daily trading volumes exceed $100 million, while on Curve they have plummeted to less than $100 million.

In fact, still in early 2023, daily trading volumes on Curve were over $400 million, with even a single peak at nearly $8 billion on March 11. 

Thereafter they first fell below 200 million, and then even below 100. 

The CRV token

Curve Finance is managed by a DAO that has its own token, called CRV. 

Although today the price of CRV is up nearly 4%, the current price is in line with the price at the end of December 2022. In other words over the course of 2023 it has shown ups and downs, but in fact it has not grown. 

The year started at $0.52, and then spiked to over $1.2 in February. The rise stopped there, however, and over the course of the next few months it almost did nothing but fall to an annual low of $0.39 touched just before mid-September. 

At that point the performance since the beginning of the year was an embarrassing -25%, but from the next day a rebound was triggered that seems to be still ongoing. 

However, it should be mentioned that the current price of about $0.53 had already been touched three days ago. 

Instead, compared to the all-time high, namely the incredible $60 touched at launch in August 2020, the cumulative loss is more than 99%.

Most of the loss, however, occurred in the first two months, because as early as October of that year it had fallen to $0.33. Since then it has definitely been in profit. 

The highest peak reached during the 2021 bullrun was $6, and since then the cumulative loss however has been 91%. 

The Lending & Borrowing platform Aave

Aave is still the second largest DeFi protocol in the world for TVL, thus surpassing even Maker and Uniswap. In this respect, only Lido, which is the protocol used for decentralized ETH staking, beats it. 

Its AAVE governance token today gains 1% in crypto markets, up 9% in the past thirty days. 

Its current market value of $62 is well above its $52 value at the beginning of the year, and compared to its all-time high, recorded in May 2021, it loses 91%. 

During last year’s bear-market it followed a path in some ways similar to CRV, but in 2023 it rose much higher. AAVE also made an annual high in February, at $92, but its lowest peak was in June, at $50. 

Curve’s founder and the relationship with Aave crypto

Michael Egorov in 2023 turns out to be particularly active. 

In August he sold as much as 106 million CRVs to collect $46 million, precisely to reduce the potential liquidation risks associated with his debt positions on various DeFi platforms, including Aave. 

To add to this, there was a hack against Curver Finance in July that netted the thieves $70 million. 

All this inevitably drove the price of CRV in September to annual lows, but the transaction to close Egorov’s debt position on Aave does not seem to have had any significant effect on its price. 

2023 therefore has been a decidedly eventful year both for Egorov, and his unscrupulous financial transactions in DeFi, and for Curve Finance itself. It is not yet clear whether this affair has ended with Aave’s departure, but it seems likely that it is in fact not yet over.