After the sudden collapse of Terra’s stablecoin, UST shook the market; Curve’s exchange liquidity pool was not alone and joined many institutional market players to compete for market share.
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.
Curve Finance founder implies a stablecoin is on its wayhttps://t.co/UNq9ell8Lt
— The Block (@TheBlock__) July 21, 2022
“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.
