CurveFinancea major player in decentralized finance (DeFi), has successfully deployed its stablecoin crvUSD on the Ethereum network. The stablecoin uses an innovative approach to automated market maker (AMM) and lending, leveraging the algorithm Lending-Liquidating Automated Market Maker (LLAMMA) to offer unique and enhanced features.
The LLAMMA algorithm: a hybrid approach to market making
The algorithm LLAMMA distinct crvUSD others MA on the market. According to the whitepaper, LLAMMA combines the strengths of traditional AMM models with lending markets, using a oracle external to ensure that the pools crvUSD consist of two separate assets: crvUSD and the asset used to mint the stablecoin, like ETH Or BTC. This structure contrasts with conventional AMM designs, where asset trading is determined by the AMM curve.
When collateral prices are high, user deposits are entirely in the collateral deposited. However, when the value of the collateral decreases, the oracle converts the deposits into crvUSDproviding a dynamic mechanism to maintain stability.
Deployment and first obstacles
CurveFinance initially deployed its crvUSD smart contracts, but the team discovered a problem: the fees were not directed to the CAD of the project. Dan SmithSenior Research Analyst at Blockworkspointed out this problem, which was quickly solved by CurveFinance with the deployment of a smart contract update.
Currently, Michael Egorov, founder and CEO of Curve Financeholds the only open loan, in the amount of $1.05 million.
The last step in the process is to launch the user interface on the website of curve.
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