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

According to a report on DeFi blue chips by on-chain analytics company OurNetwork, Crooked Finance [CRV] the largest decentralized exchange (DEX) by total value remained locked down (TVL), underlining that the protocol remained the best choice for liquidity providers.

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

The findings were corroborated by DeFiLlama, which showed TVL growth of 34% over the past month. After a vertical fall caused by the ftx contagion, Curve’s TVL rose steadily to pre-collapse levels.

Source: DeFiLlama

Why Curve Matters

Curve’s growth is aligned with the broader trend of increasing interest in DEXs following the collapse of the FTX, eroding investor confidence in centralized exchanges (CEXs). Daily trading on DEXes has doubled in the past month, facts from Dune Analytics showed.

Source: Dune analysis

Curve’s growth can also be correlated with the launch of Jed [DJED], from Cardano [ADA] oversecured stablecoin. Unlike other automatic market makers (AMM), Curve’s liquidity pools mainly consist of similar assets such as stablecoins. The arrival of another stablecoin in the market could have given a boost to Curve’s LPs.

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

Market conditions can change

Although CRV was behind Uniswap [UNI] decisive in terms of market cap, it should be noted that the protocol’s market cap/TVL ratio was below 1 at the time of writing, as per facts from CoinMarketCap. This indicated that the network was still undervalued and that there was room for further growth.

Source: Token Terminal

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The market cap increase was driven by the bullish run of native token CRV, in which its price almost doubled. However, the rally stopped on January 19 and since then the price has moved into a range with resistance at $1.1.

The Relative Strength Index (RSI) has moved out of the overbought zone and has consistently made lower highs and lower lows. This indicated that the price could break down from the range. The Awesome Oscillator (AO) was in the red, supporting the ideal of a pullback.

Source: TradingView CRV/USD

This post Curve Finance: Here’s why investors should take CRV’s earnings with a grain of salt

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