According to sources, Curve is looking to launch its first native stablecoin. At an online event on Thursday, the firm’s CEO Michael Egorov said the stablecoin would be overcollateralized. Terra USD has previously come under fire for an implosion that sent the digital asset market spiraling so much that many traders have yet to fully recover, partly for not maintaining enough collateral to maintain its one-to-one peg to the U.S. dollar.
“That’s all I can say at the moment,” Egrove said, without specifying a release date. Overcollateralized stablecoins have reserves of cryptocurrency tokens or other assets over the number of issued stablecoins, theoretically buffering against price volatility.
Egrove did not elaborate on the specific assets in reserve for the new product. Stablecoins are usually backed by USD, EUR, or other mainstream fiat currencies with liquidity. Other stablecoins, including Tether, have faced scrutiny for lack of transparency and for investing client stablecoin funds in relatively liquid assets.