The Liquidity Warz of 2025: A Brief Review of Curvance (Part 1) 🤓

defi Apr 13, 2023

Necessity is the mother of all invention.

So, what does crypto NEED right now?

How 'bout borrowing on stuff like cvxCRV, auraBAL, and LPTs...while still earning the passive interest.

Woah!

The invention is here 👇

What this post will cover:

1️⃣ What is @Curvance?

2️⃣ What is the Omnichain Gauge?

3️⃣ Tokenomics

5️⃣ Lending and Borrowing

6️⃣ Roadmap & Future updates

So, is Curvance worth the romance?😍🤔🧵👇

1️⃣ What is @Curvance?

Curvance wants to give collateralized credit to yield farmers across multiple chains and platforms.

This, they hope, will strategically position them as key players in future Defi Warz.

Their fresh approach caught our attn!👇

Curvance wants to "supercharge" participation in Liquidity Warz across chains by making the process easier for users and ecosystems alike.

How will they do that?

Let's use cvxCRV as an example...👇

Let's say you deposit cvxCRV into Curvance...

Curvance routes the deposited cvxCRV to the original Convex pool...

Your cvxCRV still earns its original interest, but you can now "lock" your Curvance deposit to get a credit limit.

Doing this also earns you CVE tokens...👇

CVE tokens can be locked, too, which gives you boosted rewards:

🤩Platform fees from the yield on TVL
🤩CVE inflation offset
🤩Voting rights in the Curvance DAO

Their vision of the future is one of increased competition for liquidity and users among projects, ecosystem flywheels, and rollups.

So, they've designed a platform focused on modular integration, with a unique gauge and voting escrow system, which we'll cover next 👇

via GIPHY

2️⃣ What is the Omnichain Gauge?

@Curvance allows you to lock CVE as veCVE on any chain and vote for any pool on any chain.

Pretty cool, right?

But how?

Using a communication layer between Ethereum and an unlimited number of "child" chains, which has lots of benefits 👇

🙌Benefits include:

🤓all protocol fees are shared equally across all chains.

🤓users can lock tokens on rollups, significantly saving on gas costs while maintaining deep liquidity and fee generation present on ETH Mainnet.

🤓protocols can expand liquidity across networks.

So how does the voting system work?

Well, it uses Snapshot's gasless voting to tally up a person's votes across all chains.

Once a voting epoch ends, the votes get moved on-chain and are processed by a matching engine on Ethereum 👇

This engine decides how much of the emissions generated should go to each chain, and then sends them out via a cross-messaging mechanism to each child gauge system.

From there, the emissions get distributed to each pool for the next epoch.

The way the CVE locker system works is similar to how its voting and gauge systems work.

Basically, it's omnichain, with ETH as the main chain.

Every so often, each "child chain" reports back its locked token state to ETH, along with all the fees collected during that time 👇

Then, the ETH gauge calculates WETH and CVE rewards for each veCVE locked during that epoch.

The ETH rewards are available right away and messages are sent to the other chains with the appropriate ETH and CVE rewards for each child chain.

Overall, its an elegant design approach that could allow Curvance to scale to a potentially unlimited number of chains with little upkeep and bloat.

CVE is also omnichain, so users can transfer them across different blockchains without requiring a liquidity pool 🔥

3️⃣ Tokenomics

The CVE token will allow users to:

1. access DAO voting rights
2. access gauge emission voting rights
3. access platform fee redistribution

Initial Circulating Supply = 40,368,588.72

Max Supply = 420,000,069

But, how will CVE be allocated? 🤔

👀Token Allocation👀

55% - Gauge Emissions, Boosted Lock Rewards (over minimum 12 years)

13.5% - Team – Vested over 4 years released monthly, 25% will be vote-locked on TGE

13% - Treasury – 25% (vote-locked on TGE) 👇

8% - CVE Lockers – Distributed over a minimum 12-year period

6% -Seed Raise – Vote-locked with no additional CVE reward incentive during the vesting period (1 year)

1.7% - Initial Pool Liquidity- paired with treasury tokens as protocol-owned liquidity after beta launch

1.3% - Beta Boosted Emissions – From TGE emitted as call options

1% - Early Backers Raise – Vote-locked with no additional CVE reward incentive during the vesting period (1 year)

0.5% - Early Backer/Incentivized Testnet Airdrop - From TGE as call options

👀Boosted Rewards👀

Curvance wants to incentivize long-term investing in its DAO voting power (VP).

So, they have a "continuous lock" feature that keeps users locked for max duration sans the need to relock and waste gas.

In return, users get a bonus on their VP (10% atm)😎

👀The Emission Locker👀

Another great feature allows those who have unclaimed CVE rewards from gauge emissions to claim and choose to instantly lock them as veCVE for a 10% bonus allocation.

Again, the goal is to reward long-term minded users and protocols...incentivizing those who are aligned with the DAO's goals...

👀CVE Call Options👀

Remember,

1.3% of tokens are for "Beta Boosted Emissions," which will be emitted as call options...

and

0.5% of tokens are for Early Backer/Incentivized Testnet Airdrop, which will be emitted as call options...

So, how do these options work?👇

Curvance's token airdrop and beta launch will be provided as call options rather than standard tokens.

This will limit potential sell pressure and align incentives by requiring users to put capital at risk in order to receive CVE tokens 👇

As people start using the protocol more and more, these call options will become more and more appealing.

This also means if the protocol is successful, users will receive more and more call options.👇

Anything else you need to know?

Yes,

a. The options can be exercised immediately following the LBP auction with a 6 week expiration.

b. The strike price will be 50% of the starting LBP token price.🤓

Pretty neat, right?