Curve DAO and CRV: what they are and what they do

Curve Finance swaps stablecoins and similar assets with low slippage through an automated market maker. The DAO pays out CRV rewards to steer liquidity toward the pools its voters choose.

How does Curve DAO work?

Holders lock CRV for a set period and receive vote-escrowed CRV, or veCRV. A longer lock carries more voting power. That power decides which pools receive CRV rewards.

• Lock CRV to earn veCRV and voting weight.
• Vote on which pools receive rewards.
• Boost a pool's incentives with your vote.
• Vote on fee and protocol changes.

Who created Curve and when?

Michael Egorov created Curve Finance, and the exchange launched on Ethereum in January 2020. The DAO and the CRV token followed in August 2020. Curve DAO is not a company, and CRV is not equity in one.

How is Curve different from Uniswap?

Both are automated market makers on Ethereum, but they are built for different jobs. Uniswap supports a wide range of compatible ERC-20 token pairs, while Curve is best known for swaps between stablecoins and other assets that trade near the same value. Uniswap v2 prices trades with a constant product formula, and v3 and v4 use concentrated liquidity.

What risks and legal issues does Curve face?

The DAO does not set the price of CRV and does not promise rewards. Pools can lose value if a stablecoin loses its peg, and smart contracts can carry bugs. In July 2023, attackers used a bug in some Curve pools to drain funds.

Written byVahe HakobyanVahe Hakobyan is the editor-in-chief of World-Crypt. He covers bitcoin, markets and regulation, and leads the newsroom that fact-checks every story before it goes live.