Curvance: The Unlockening
Debt is one of the most powerful tools in traditional and decentralized finance. However, a common issue a user faces in decentralized finance is the inability to collateralize liquidity they have provided to various ecosystems. In many cases, a user would need to stop providing liquidity to the most lucrative pools and bring the asset to somewhere like Aave or Compound. While these protocols are great for collateralized loans, they are not ideal for the farmer or the builders, whose yields become decimated when removing their tokens from participation. This stifles the growth of ecosystems as savvy users want to maximize their capital efficiency.
Curvance seeks to unlock wrapped tokens such as cvxCRV, auraBAL, liquidity pool tokens, and much more. Allowing users to earn the APR they would on their original platforms while using those deposits as collateral for secure, stablecoin loans. Each asset's borrowing limit automatically determines lending ratios based on various factors, allowing users to borrow funds to invest and earn more.
For example, a user may deposit cvxCRV tokens from the Convex Finance platform into Curvance. Our protocol routes the deposited cvxCRV to the original Convex pool. While the tokens are earning interest, the user can 'lock' their deposit as collateral to gain a credit limit.
Liquidity providers to the Curvance protocol earn CVE tokens, which can be locked to receive boosted rewards:
- Platform fees from the yield on TVL
- CVE inflation offset
- Voting rights in the Curvance DAO
By extending collateralized credit limits to yield farmers, Curvance is, in a way, unlocking a large percentage of the deeper DeFi market. This breakthrough will reduce the complexity of yield farming and make our protocol a compelling tool in future DeFi wars. Additionally, Curvance aims to extend collateralized credit limits crosschain, and cross platform, unlocking capital efficiency across the DeFi ecosystem.