New Curve (CRV) Tokenomics Pt. II
The recent boom in Defi activity has been very taxing on the Ethereum network. But even with increasing costs, people expect to earn huge profits on protocols like Curve Finance.
No doubt many other protocols are hot right now, including the Yearn Finance governance token (YFI), but the Curve governance token was only just released so we are still discovering it’s true value.
If one chooses to vote-lock their CRV, they may receive a huge boost to their ROI — some pools over 200%. But what amount of CRV do you need to lock in order to receive such yields?
At the time of writing, the Curve calculator says that for every $1,000 of liquidity provided, you would need to stake 79 CRV for 4 years. At $3.83 per CRV, that is $302.57. In other words, 30%.
It is important to know that the ratio of CRV locked vs Liquidity Provided is not fixed and will change as people lock and unlock CRV. In fact, the CRV required for max boost has increased since I began writing this article.
At this stage, I think the value of the CRV token will almost certainly increase with more and more supply locked. But keep in mind, the incentive exists because locking these tokens for 4 years is a huge bet on the Curve DAO.