Curve DAO Token (CRV): a token of the leading DEX protocol for trading stablecoins
This article will discuss Curve DAO Token, which has become part of the Curve.fi ecosystem, one of the leading decentralized trading platforms in the DeFi segment.
What is Curve DAO Token?
Curve DAO or CRV is a utility token of the Curve.fi ecosystem, built on the Ethereum blockchain by the ERC-20 standard and used to exchange stablecoins and other digital assets on various DeFi platforms.
Liquidity providers can add Curve DAO tokens to Curve.fi pools and earn revenue through commissions. Through Curve.fi liquidity pools, traders can exchange CRVs for other tokens and vice versa.
Curve DAO is a governance token used by members of the Curve.fi ecosystem's decentralized autonomous organization (DAO) to vote for suggestions to improve the platform.
How is Curve DAO organized?
At the heart of the Curve DAO ecosystem is the decentralized exchange (DEX) and automated market maker (AMM) Curve.fi, also known as Curve Finance. The Curve.fi protocol was launched in 2020 and uses liquidity pools instead of traditional order books (or orders) for exchanges, the most popular trading platform model in decentralized finance (DeFi).
As of December 2024, Curve.fi's decentralized exchange ranks 3rd among decentralized exchanges by total blockchain value (TVL) after Uniswap and Raydium and 21st among all DeFi protocols according to DeFi Llama: TVL is over $2.2 billion and has grown 22% since the beginning of the year.
In addition, Curve.fi is one of the most used DEX platforms for exchanging stablecoins. Curve.fi experienced its most intense growth in 2020 amid the "DeFi boom" at that time; it also secured its position as the leading DEX exchange for stablecoin exchanges.
Curve.fi's DeFi protocol mechanism incentivizes liquidity providers to add their assets to pools by rewarding them with native tokens of the CRV platform.
Among other things, the Curve.fi protocol is designed to reduce slippage in token swaps. Slippage is a situation in which the price of the actual swap differs from the price at which the trader opened the trade.
About Curve DAO token
As of December 2024, 2.2 billion CRV tokens have been issued, of which only 1.25 billion are traded on the crypto market — a little more than half of all existing tokens.
However, according to CoinMarketCap, Curve DAO tokens have no issuance limit. This means the asset is inflationary and, in consultation with the community, the Curve.fi project team can issue additional tokens to the market, which may reduce their investment appeal in the long run.
Curve DAO has a market capitalization of $1.38 billion, which has grown almost 2.3 times in the last year. The CRV token itself is ranked 89th in the CoinMarketCap ranking. The price of the Curve DAO token has reached $1.11, which, however, is still far from the all-time high recorded when CRV was listed on exchanges in August 2020.
Curve DAO outlook and plans of the project team
In November 2024, the Curve DAO team partnered with BlackRock, the world's largest investment firm with $10.5 trillion in assets under management, according to the first quarter of the same year. The goal of Curve.fi's partnership with BlackRock is to increase the liquidity of the DeFi platform.
According to the Curve Finance team, the potential for liquidity growth is up to $1 billion shortly due to the infusion of RWA assets via the Elixir blockchain protocol, which can be converted into stablecoins thanks to the integration of the BlackRock fund with the decentralized Curve.fi platform.