AAVE CHAN FOUNDER PROPOSES BUYING $2M IN CRV FROM CURVE FOUNDER

Last updated: June 19, 2025, 23:08 | Written by: Linda Xie

The decentralized finance (DeFi) world is buzzing with a new proposal that could significantly impact the Curve ecosystem and the future of stablecoins. Amid growing uncertainty among decentralized finance (DeFi) protocols around exposure to Curve, Aave Chan founder Marc Zeller has proposed the Aave treasury buy $2 million worth of Curve DAO Token (CRV) from Curve founder Michael Egorov with USDT (USDT). The proposal says the acquisition would send a strong signal of DeFi supporting DeFi, while allowing the [ ]Amidst growing anxieties surrounding DeFi protocols and their exposure to Curve Finance, Marc Zeller, the influential Aave Chan founder, has stepped forward with a bold proposition: for the Aave treasury to acquire $2 million worth of Curve DAO Token (CRV) directly from Curve founder Michael Egorov, using USDT. Amidst the uncertainty surrounding decentralized finance (DeFi) protocols and their exposure to Curve, Aave Chan founder Marc Zeller has put forth a proposal for the Aave treasury to purchase $2 million worth of Curve DAO Token (CRV) from Curve founder Michael Egorov using USDT. The purpose of this proposal is to send a strong signalThis move, if approved, isn't just a simple transaction; it's a strategic play signaling confidence in DeFi and potentially offering Aave a stronger foothold in the competitive ""Curve Wars.""

But why this move, and why now? The proposal drew mixed reactions from the community where some criticized the strategy for buying more CRV even as others are looking to shed exposure. Amid growing uncertainty around Curve exposure for many decentralized finance protocols, Aave Chan founder Marc Zeller has proposed that Aave Treasury buy $2 million worth of CRV tokens in USDT [ ]With Curve’s stability seemingly shaky due to Egorov's substantial loan positions collateralized by CRV, the DeFi community finds itself at a critical juncture.Zeller's proposal aims to inject stability and demonstrate a united front, but it's also sparked heated debates within the Aave community. The proposal noted that the $2 million worth of Curve DAO Tokens (CRV) acquisition would send a strong signal of DeFi supporting DeFi while allowing the Aave DAO to strategically position itself in the Curve wars and help Aave s decentralized multi-collateral stablecoin GHO s liquidity.Will it bolster GHO, Aave’s decentralized stablecoin?Or will it expose Aave to further risk in an already volatile market?Let's dive into the details of this fascinating proposal and explore the potential ramifications for Aave, Curve, and the broader DeFi landscape.

Understanding the Context: Curve's Importance in DeFi

Before delving into the specifics of the proposal, it’s crucial to understand Curve's significance in the DeFi ecosystem. Curve Finance is a decentralized exchange (DEX) specializing in stablecoin swaps. Amid growing uncertainty around Curve exposure for many decentralized finance protocols, Aave Chan founder Marc Zeller has proposed that Aave Treasury buy $2 million worth of CRV tokens in USDT from Curve Founder Michael Egorov.Its Automated Market Maker (AMM) mechanism is designed for extremely efficient trading of assets with similar values, like different versions of USD stablecoins (USDT, USDC, DAI) or wrapped Bitcoin (WBTC, renBTC).

Curve's importance stems from several factors:

Low Slippage: Curve's AMM design minimizes slippage, making it ideal for large stablecoin trades.
Liquidity Provider (LP) Incentives: Curve incentivizes users to provide liquidity by rewarding them with trading fees and CRV tokens.
Foundation for DeFi: Many DeFi protocols rely on Curve for stablecoin liquidity, making it a foundational component of the ecosystem.

However, this central role also means that any vulnerability or instability within Curve can have ripple effects throughout the DeFi space. Amid rising uncertainty amongst decentralized finance (DeFi) protocols round publicity to Curve, Aave Chan founder Marc Zeller has proposed the Aave treasury purchase $2 million value of Curve DAO Token (CRV) from Curve founder Michael Egorov with USDT (USDT). The proposal says the acquisition would ship a powerful sign of DeFi supporting DeFi, whereas permitting the [ ]This is the backdrop against which Zeller's proposal emerges, a direct response to concerns about Curve's solvency and its potential impact on other protocols.

Aave's CRV Acquisition Proposal: Details and Motivation

The core of the proposal is straightforward: the Aave treasury would purchase $2 million worth of CRV tokens directly from Michael Egorov, the founder of Curve Finance, using USDT.Zeller outlined several key motivations behind this proposed acquisition:

Signal of Support for DeFi: The purchase would send a powerful message of solidarity and confidence in the DeFi ecosystem, reassuring participants during a period of uncertainty.
Strategic Positioning in the Curve Ecosystem: Owning a significant amount of CRV would give Aave DAO a stronger voice in the governance of Curve Finance.
Boosting GHO Liquidity: By participating in Curve's liquidity pools, Aave could increase the liquidity and adoption of its decentralized stablecoin, GHO.
Mitigation of Systemic Risk: By supporting Curve, Aave aims to prevent a potential collapse that could negatively impact numerous other DeFi protocols.

In essence, Zeller argues that a proactive investment in CRV is a strategic move that benefits Aave in the long run by strengthening the entire DeFi ecosystem. The proposal drew mixed reactions from the community, with some criticizing the strategy for buying more CRV even as others are looking to shed exposure. Amid growing uncertainty among decentralized finance (DeFi) protocols around exposure to Curve, Aave Chan founder Marc Zeller has proposed the Aave treasury buy $2 million worth of Curve DAO Token (CRV) from Curve founder Michael Egorov withBut is this the right approach? Aave Chan founder proposes buying $2M CRV from Curve founder cointelegraph.com Open. Share Add a Comment. Be the first to comment Nobody's responded to this post yet.Let's explore the counterarguments.

Community Reactions: A Divided Opinion

Zeller's proposal has been met with mixed reactions from the Aave community.While some members support the initiative, others have voiced concerns and criticisms.

Arguments in Favor:

Long-Term Vision: Supporters believe the purchase is a long-term investment in the health of DeFi and that Aave, as a leading protocol, has a responsibility to support the ecosystem.
GHO Synergy: Owning CRV could create opportunities to incentivize GHO adoption within Curve pools, leading to greater stability and utility for Aave's stablecoin.
Governance Power: Increased CRV holdings translate to greater voting power in Curve governance, allowing Aave to influence decisions that affect its interests.

Arguments Against:

Risk Exposure: Critics argue that buying more CRV exposes Aave to further risk, especially given the ongoing uncertainty surrounding Curve's solvency.
Poor Use of Treasury Funds: Some believe the $2 million could be better utilized for other initiatives, such as developing new Aave features or improving security.
Moral Hazard: Critics worry that bailing out Curve could set a dangerous precedent, encouraging risky behavior by other protocols with the expectation of future bailouts.

The debate highlights the complex considerations involved in managing a large DeFi treasury and the need to balance risk and reward when making strategic investments.Is it prudent to inject capital into a potentially failing project, or is it a necessary step to protect the broader ecosystem?

Michael Egorov's Loan Positions: A Cause for Concern

A key factor driving the anxiety surrounding Curve is the substantial loan positions held by its founder, Michael Egorov. Amid growing uncertainty among decentralized finance (DeFi) protocols around exposure to Curve, Aave Chan founder Marc Zeller has proposed the Thursday, Aug All newsReports indicate that Egorov has over $100 million in outstanding loans from various lending protocols, including a significant portion – around $70 million – in USDT on Aave v2.These loans are collateralized by CRV.

The concern arises from the potential for liquidation. Amid growing uncertainty among decentralized finance (DeFi) protocols around exposure to Curve, Aave Chan founder Marc Zeller has proposed the Aave treasury buy $2 million worth of Curve DAOIf the price of CRV drops significantly, Egorov's collateral could be liquidated, flooding the market with CRV and further depressing the price. The proposal drew mixed reactions from the community where some criticized the strategy for buying more CRV even as others Aave Chan founder proposes buying $2M CRV from Curve founder - XBT.Market Market Cap: $1,941,867,182,127.03This could trigger a cascade effect, impacting other CRV holders and potentially destabilizing Curve and related DeFi protocols.

The Role of CRV in Curve Governance and Liquidity

CRV is not just a token; it's the governance token of Curve DAO.Holding CRV grants voting rights, allowing holders to influence decisions related to protocol parameters, liquidity pool incentives, and future development.

Furthermore, CRV is used to boost rewards for liquidity providers.By locking CRV, users can obtain veCRV (vote-escrowed CRV), which allows them to boost their liquidity mining rewards on Curve pools. Amid growing uncertainty among decentralized finance (DeFi) protocols around exposure to Curve, Aave Chan founder Marc Zeller has proposed the Aave treasury buy $2 million worth of Curve DAO Token (CRV) from Curve founder Michael Egorov with USDT (USDT).This mechanism, known as ""vote-locking,"" has created a competitive landscape known as the ""Curve Wars,"" where protocols compete to accumulate veCRV to direct rewards towards their preferred pools.

Aave's acquisition of CRV could therefore give it more influence over Curve's governance and allow it to strategically direct rewards towards pools that support GHO liquidity, creating a mutually beneficial relationship.

Potential Benefits and Risks of Aave's CRV Purchase

Let's break down the potential benefits and risks of Aave's proposed CRV purchase in more detail:

Potential Benefits:

Increased GHO Adoption: By incentivizing liquidity on Curve pools, Aave can promote the adoption and stability of GHO, its decentralized stablecoin.This would make GHO more competitive and attractive to users.
Enhanced Governance Power: A larger CRV holding grants Aave greater influence over Curve's governance, allowing it to shape the protocol's future development and ensure its alignment with Aave's interests.
Strengthened DeFi Ecosystem: Supporting Curve can help prevent a potential collapse that could negatively impact numerous other DeFi protocols, fostering a more stable and resilient ecosystem.
Potential Profit: If Curve recovers and CRV appreciates in value, Aave could realize a profit on its investment.

Potential Risks:

Financial Loss: If Curve's situation worsens and CRV declines further, Aave could lose a significant portion of its $2 million investment.
Opportunity Cost: The $2 million could be used for other initiatives that might offer a higher return or greater benefit to Aave.
Reputational Damage: If the purchase fails to stabilize Curve, Aave could face criticism for mismanaging its treasury and potentially contributing to the protocol's downfall.
Moral Hazard: Bailing out Curve could encourage other protocols to take on excessive risk, knowing that they might be rescued if things go wrong.

Comparing Alternatives: What Else Could Aave Do?

Before making a decision on the CRV purchase, the Aave community should consider alternative strategies for supporting DeFi and boosting GHO liquidity.Here are a few possibilities:

Direct GHO Incentives: Instead of buying CRV, Aave could directly incentivize users to hold and use GHO through staking rewards, yield farming programs, or other promotional campaigns.
Partnerships with Other Protocols: Aave could collaborate with other DeFi protocols to integrate GHO and promote its adoption across different platforms.
Focus on Aave V3 Development: Investing in the development of Aave V3, the latest version of the Aave protocol, could enhance its security, efficiency, and features, attracting more users and boosting its overall value.
Treasury Diversification: Aave could diversify its treasury holdings by investing in a wider range of assets, reducing its exposure to any single protocol or token.

By carefully evaluating these alternatives, the Aave community can make a more informed decision about the best way to utilize its treasury funds and support the long-term growth of its ecosystem.

The Future of Curve and its Impact on DeFi

The situation surrounding Curve highlights the inherent risks and interconnectedness within the DeFi ecosystem.A single protocol's struggles can quickly ripple outwards, impacting other protocols and potentially destabilizing the entire system.

Whether or not Aave's CRV purchase goes through, the outcome will have significant implications for the future of Curve and its role in DeFi.If the purchase is approved and helps stabilize Curve, it could signal a new era of collaboration and mutual support among DeFi protocols. Altszn.com provides the latest news, resources and insights on Bitcoin, Ethereum, Solana, DeFi, Web3, NFTs and other cryptocurrency markets.If the purchase fails or is rejected, it could lead to further uncertainty and potentially accelerate Curve's decline.

Regardless of the outcome, the episode serves as a reminder of the importance of risk management, diversification, and responsible governance in the DeFi space. Amid growing uncertainty among decentralized finance (DeFi) protocols around exposure to Curve, Aave Chan founder Marc Zeller has proposed the Aave treasury buy $2 million worth of Curve DAO Token (CRV) from Curve founder Michael Egorov with USDT USDTUSD.As the ecosystem continues to evolve, protocols must prioritize security, transparency, and collaboration to ensure its long-term sustainability.

Actionable Advice for DeFi Participants

Here are some actionable steps that DeFi participants can take to navigate the current uncertainty:

Diversify Your Holdings: Avoid concentrating your assets in a single protocol or token.Diversification can help mitigate the impact of any individual protocol's struggles.
Stay Informed: Keep up-to-date with the latest news and developments in the DeFi space. Marriott s New Brand Could Please Value Travelers But Maybe MaUnderstanding the risks and opportunities can help you make more informed decisions.
Manage Your Risk: Use stop-loss orders and other risk management tools to protect your capital. Aave Chan founder proposes buying $2M CRV from Curve founderNever invest more than you can afford to lose.
Participate in Governance: Get involved in the governance of the protocols you use.Your voice can help shape the future of DeFi.
Support Sustainable Projects: Choose to support projects that prioritize security, transparency, and responsible governance.These projects are more likely to withstand the test of time.

Conclusion: A Critical Moment for DeFi Collaboration

Aave Chan founder Marc Zeller's proposal to purchase $2 million in CRV from Curve founder Michael Egorov is more than just a transaction; it's a pivotal moment for the DeFi community.It represents a potential demonstration of solidarity, a strategic move to bolster GHO liquidity, and an attempt to mitigate systemic risk within the decentralized finance landscape. The proposal drew mixed reactions from the community, with some criticizing the strategy for buying more CRV even as others are looking to shed exposure.Amid growing uncertainty among decentralized finance (DeFi) protocols around exposure to Curve, Aave Chan founder Marc Zeller has proposed the Aave treasury buy $2 million worth of Curve DAOHowever, it's also a decision fraught with potential risks, including financial loss and the setting of a possible moral hazard.

The mixed reactions within the Aave community underscore the complexities of such a decision, highlighting the need for careful consideration of alternatives and a clear understanding of the potential benefits and drawbacks.Ultimately, whether or not Aave proceeds with the purchase, the situation surrounding Curve serves as a valuable lesson about the interconnectedness of DeFi protocols and the importance of responsible governance and risk management.It also underscores the power of community and the critical need for collaboration to ensure the long-term sustainability and success of decentralized finance.

As the DeFi ecosystem continues to evolve, these lessons will be crucial in navigating future challenges and building a more resilient and robust financial system.The key takeaway is that DeFi's success depends on proactive participation, informed decision-making, and a commitment to collaboration within the community. Posted by u/conceiv3d-in-lib3rty - 4 votes and 42 commentsKeep an eye on how this situation unfolds, as it could set a precedent for how DeFi protocols support each other in times of crisis.What will Aave decide?Only time will tell.