DeFi tokens and protocols took a heavy hit on May 19 as Bitcoin price dropped to $30,000 and while BTC has entered what some analysts describe as a ‘compression’ phase, the total value locked in DeFi and the value many of the sector’s tokens have yet to rebound to the levels seen before the market crash.
Curve DAO token (CRV) stands among the few DeFi tokens that have seen a strong recovery over the past two weeks due to reduced Ethereum gas fees, the launch of Convex Finance and the DeFi sector beginning to find a bottom.
Data from Cointelegraph Markets Pro and TradingView shows that CRV has increased 55% since June 1, rallying from a low of $1.76 on June 1 to an intraday high at $2.76 on June 3 alongside a 250% increase in 24-hour trading volume.
Convex Finance launch attracts CRV holders
One source of the sudden rise in price and momentum for CRV is Convex Finance (CVX), an optimizer for the Curve Protocol that enables swaps of similar assets like stablecoin to stablecoin transactions.
Introducing Convex Finance! A new platform, built by Defi Natives, to simplify your Curve-boosting experience to maximize your yields.
Read more here! https://t.co/65Dog7RdqE
— Convex Finance (@ConvexFinance) April 15, 2021
Since it’s official launch on May 17, the Convex protocol has rapidly gained a substantial user base thanks to yields as high as 52.16% and some analysts have suggested that the protocol is challenging Yearn.finance for CRV-related deposits.
Data from Defi Llama shows that in the two and a half weeks since the launch of Convex Finance, the total value locked (TVL) on the protocol has surpassed $2.3 billion with stakers on the protocol earning $4.3 million in total revenue.
Both Convex Finance and Yearn.finance rely heavily on CRV for the operation of their platforms and the increased activity has resulted in a decline in the circulating supply of CRV. This may have…