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Curve Founder Michael Egorov Risks Liquidation: CRV Drops 35%

2 mins
Updated by Daria Krasnova
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In Brief

  • Curve DAO (CRV) fell 35% as founder Michael Egorov faces potential liquidation.
  • Egorov risks $140 million in CRV liquidations, borrowing $95.7 million in stablecoins.
  • CRV price rebounded 18% to $0.26 after initial drop, reflecting market volatility.
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The price of Curve DAO (CRV) plummeted by up to 35% within a few hours. This sharp decline came after news broke that Michael Egorov, the founder of Curve, might face liquidation.

Egorov, a key figure in the decentralized finance (DeFi) sector, is currently navigating a precarious trading situation.

Curve Founder’s Potential Liquidation Causes Panic

According to Arkham, an on-chain analysis platform, Egorov is close to seeing $140 million worth of CRV liquidated. He has borrowed around $95.7 million in stablecoins, primarily crvUSD, against $141 million in CRV distributed across five accounts on various lending protocols.

“Based on current rates, Egorov is paying $60 million annually in order to keep his positions open on Llamalend,” Arkham said.

Read more: What Is Curve (CRV)?

Egorov borrowed $50 million through the DeFi platform – Llamalend at an annual percentage yield (APY) of roughly 120%. This high rate is largely due to the near absence of crvUSD available to borrow against CRV on Llamalend. Notably, three of Egorov’s accounts comprise more than 90% of the crvUSD borrowed on this protocol.

Additionally, data from Spot On Chain reveals that Egorov presently has 139 million CRV tokens worth $37 million as collateral, with debts amounting to $27 million across three platforms. According to the latest update from Arkham, Egorov’s $140 million positions were liquidated.

“The price of CRV fell through Egorov’s liquidation threshold this morning, with his entire 9-figure lending position liquidated across five protocols,” Arkham said.

The falling price of CRV has also impacted other major players in the market. For example, a crypto whale, 0xF07, was compelled to transfer 29.62 million CRV, valued at approximately $7.68 million, to Binance due to a liquidation on Fraxlend.

That being said, Ki Young Ju, founder of another on-chain analysis platform – CryptoQuant, observed a significant increase in the CRV balance on exchanges, reaching an all-time high. It surged by 57% in just four hours.

Curve DAO Token Exchange Reserves
Curve DAO Token Exchange Reserves. Source: CryptoQuant

After initially dropping from $0.35 to $0.21, the price of CRV has since shown resilience, recovering to about $0.26, marking an 18% rebound. This scenario highlights the volatile and unpredictable nature of the crypto markets.

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Harsh Notariya
Harsh Notariya is a journalist at BeInCrypto, who writes about various topics, including decentralized physical infrastructure networks (DePIN), tokenization, crypto airdrops, decentralized finance (DeFi), meme coins, and altcoins. Before joining BeInCrypto, he was a community consultant at Totality Corp, specializing in the metaverse and non-fungible tokens (NFTs). Additionally, Harsh was a blockchain content writer and researcher at Financial Funda, where he created educational reports on...
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