Justin Sun Sinks His Teeth into Curve as He Buys CRV From its Founder Who Offloaded $20M Hours After a Hack

in LeoFinance7 months ago

Curve is one of the most interesting DeFi projects to me. They are one of the oldest Decentralized Finance protocols in the industry and have managed to attract over $3B in TVL - making them also one of the largest protocols in the industry.

Yesterday, I wrote a post talking about Curve and the attack that happened due to a Vyper vulnerability in some of the Curve pools. $75M was stolen, $25M turned out to be white hacks and was returned. ~$52M was the final figure of what was unrecoverable.

At the time of the hack, the Curve protocol had $3.7B. It then dropped to $2.1B as people withdrew in fear.

That hack was not the worst news for Curve... Their native token - CRV - started to tank post-hack. This was partly due to the hackers stealing 7.19M CRV (worth $4.52 Million USD) and partly due to concerns/fears of both the protocol and the founder's massive Aave loans.

This has been an ongoing story for months now - the founder of Curve - Michael Egorov - has over $168M in CRV tokens that he's using on a multitude of platforms as collateral for DeFi loans.


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$168M In Collateral for CRV Tokens

The team stake he has is sitting on all these DeFi platforms as collateral. We all know how DeFi loans work - if the value of the collateral drops below the predetermined LTV - Loan to Value - ratio, then the position is liquidated.

Being that the amount of CRV the founder of Curve has locked away is 34% of the market cap, this is dangerous af for Curve.

In my opinion, one of the biggest risks to Curve is the centralization of its founder's stake which is being used as collateral.

It's also a huge risk to the entire DeFi industry... You've got one guy who, if he blows up, will drag Billions of dollars in capital along with him.

He will create bad debt for Aave and pretty much every other major DeFi lender out there. It's a huge risk and it hinges on one dude. I'm not a huge fan of this.

Justin Sun Buys CRV

Egorov sold CRV tokens - to the tune of $20M - just 1 day after the hack of a few Curve pools. He used this capital to pay back some of his loans and reduce his risk of blowing up and getting liquidated.

Notable amongst the list of people who bought CRV from Egorov is Justin Sun - a person who pretty much everyone in crypto dislikes.

All-in-all, Egorov sold $20m CRV for $0.40 per token (it's currently trading at $0.60).

5M of that CRV was bought by Justin Sun for $2M USDT (a $1M discount from market price).

Hostile Takeover?

CRV has a governance structure. That being said, I don't believe 5M CRV will allow Justin to unilaterally do anything.

We also know that Justin has a history of taking over chains and protocols when it is to his advantage. Should we expect that Justin is making a play here?

I see several risks for Curve. It's not just about governance.

If someone like Justin gets enough CRV, he could potentially squeeze Michael Egorov's massive loan positions across DeFi..

Imagine if you had billions of dollars and you saw the opportunity to short CRV and the entire DeFi sector. All you had to do was have enough capital to soak up the required CRV to dump the price below $0.372 (Egorov's Liquidation Price) and then you could literally make hundreds of Millions in profit by squeezing the industry.

Would Sun do it? I sure think so.

5M CRV won't be enough but if he keeps buying, I would start getting concerned.

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Is this the same guy who took over steemit?😡 I used to have some CRVs. Glad I sold it. !PGM

Sent 0.1 PGM - 0.1 LVL- 1 STARBITS - 0.05 DEC - 1 SBT - 0.1 THG - 0.000001 SQM - 0.1 BUDS - 0.01 WOO - 0.005 SCRAP tokens

remaining commands 7

BUY AND STAKE THE PGM TO SEND A LOT OF TOKENS!

The tokens that the command sends are: 0.1 PGM-0.1 LVL-0.1 THGAMING-0.05 DEC-15 SBT-1 STARBITS-[0.00000001 BTC (SWAP.BTC) only if you have 2500 PGM in stake or more ]

5000 PGM IN STAKE = 2x rewards!

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It sure is!

I like how the proposal is squeezed between the post. Going to do the right thing and upvote it.

Great post as always!

thanks Pouchon! Just a small little plug in there lol

We’re only 26% away from approval 💪🏽

Great to see the approach covers the fundamentals for the community.
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how do we buy curve otc?

contact their founder, he’s got millions lol

LOL
I was reading @theycallmedan Twitter Tweets about Curve centralization, and as usual he wasn't pulling any piunches about the Curve Founder having retained a significant portion of the Curve Token, and how this centralization of token distribution created a central point of failure, which could wipe out the investment of many invested in curve.

It's interesting how in many instances it all comes back to centralization, as a weak point for even the largest and most successful projects.

I think that's why your actions from the beginning or "Steemleo days" to decentralize your project have generated so much loyalty in the community.

Thank you

Sun is a tyrant and will surely do anything to add to his worth.

he really is

Sun throwing money at something like this while not using it to grow the innate projects like steem looks fishy to me. I bet he’s there to milk his own share of the pie. But we’ll see wher things lead to over time

that’s how he rolls. He’s just in everything to milk it

This is simple and concise, buying an SUV won't serve like investing.

!PGM
!PIZZA
!CTP

Sent 0.1 PGM - 0.1 LVL- 1 STARBITS - 0.05 DEC - 1 SBT - 0.1 THG - 0.000001 SQM - 0.1 BUDS - 0.01 WOO - 0.005 SCRAP tokens

remaining commands 2

BUY AND STAKE THE PGM TO SEND A LOT OF TOKENS!

The tokens that the command sends are: 0.1 PGM-0.1 LVL-0.1 THGAMING-0.05 DEC-15 SBT-1 STARBITS-[0.00000001 BTC (SWAP.BTC) only if you have 2500 PGM in stake or more ]

5000 PGM IN STAKE = 2x rewards!

image.png
Discord image.png

Support the curation account @ pgm-curator with a delegation 10 HP - 50 HP - 100 HP - 500 HP - 1000 HP

Get potential votes from @ pgm-curator by paying in PGM, here is a guide

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PIZZA!

$PIZZA slices delivered:
@torran(8/10) tipped @khaleelkazi

Justin Sun can do anything...

Na man!!! why do you think him like a sharp villain. It's good he got the CRV tokens and took the price of CrV up helping in the price not dipping down for that other curve CEO postion not getting liquidated.

Other big guys are also buying crv...

but its bizare man, I wanted to get crv myself, like its the top DEX for stablecoin liquidity, very very important and there all this things happen, then where to invest.

Quite schocking.

And that CEO got 40% of CRV man ... locked up!!

OUCH!!!!... centralisation!!! Big red flag there...

Anyway.. its stupid, all like cricket and other match monitoring that fellows activities and speculating will his position get liquidated.

No privacy!!! Talk of the crypto world.

Justin's rotten, but his tron Blockchain is doing fine... stable coins launches on chain, main use case, so he will be there!!!

This time he made good news, else I used to hate this guy... even before steem incident...anyway

When I read this headline my first thought was that Justin Sun must have really fallen far if he had to give up his Lambo for a Honda CRV...