Curve Financing: This is why investors should take CRV dividends with caution

  • The total value locked on Curve has rapidly expanded to pre-FTX levels.
  • The CRV native token price and market capitalization are at risk of pullback.

according to a report on blue DeFi chips by string analysis firm OurNetwork, Curve Finance [CRV] It remained the largest decentralized exchange (DEX) with Total Value Locked (TVL), confirming that the protocol remained the best choice for liquidity providers.

Read Curve Finance’s [CRV] Price forecast 2023-24

The results were confirmed by DeFiLlama, which showed TVL growing by 34% in the last month. After the vertical fall spur off FTX Contagion, Curves TVL rose steadily towards pre-crash levels.

Source: DeFiLlama

Why Curve is such a big deal

Curve’s growth is in line with the broader trend of rising interest in DEX bonds after the collapse of FTX, which eroded investor confidence in centralized exchanges (CEX). Daily turnover on the DEX has doubled in the past month, data From Dune Analytics.

Source: Dune Analytics

Curve’s growth could also be associated with a launch grandfather [DJED]And Cardanos [ADA] A hypersafe stablecoin. Unlike other automated market makers (AMMs), Curve’s liquidity pools are primarily made up of assets that act similarly to stablecoins. The entry of another stablecoin in the market may have given Curve coin purveyors a boost.

In addition, Curve Finance has taken steps to expand its liquidity pool by adding more meter to the platform. The net effect of all of the above factors could have fueled Curve’s adoption.

Market conditions may change

Although CRV went after Uniswap [UNI] Decisive in terms of market capitalization, it should be noted that the protocol’s market capitalization / TVL ratio was less than 1 at the time of publication, per data From CoinMarketCap. This indicates that the network is still undervalued and that there is room for further growth.

Source: Token Terminal

Is your wallet green? Check out the CRV Earnings Calculator

The increase in the market cap was driven by the bullish rally of the native CRV token, with the price nearly doubling. However, the rally was halted on January 19th and since then the price has been moving in a range with the $1.1 resistance.

The Relative Strength Index (RSI) has fallen out of the overbought territory and is consistently making lower highs and lower lows. This indicates that the price may break out from the range. The Awesome Oscillator (AO) was in the red which supports the pullback notion.

Source: TradingView CRV / USD

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