Curve Finance launched in 2020, built by Michael Egorov, a Russian physicist and quant. Its innovation was the Stableswap algorithm — an AMM specifically optimized for assets that should trade near the same price, like USDC/USDT or different ETH variants. Before Curve, swapping stablecoins through Uniswap caused significant slippage. Curve eliminated that, and by 2021 it was processing billions in daily volume for stablecoin swaps alone.
Curve’s governance design (veCRV, vote-escrowed CRV) triggered the infamous “Curve Wars” of 2021-2022. Protocols including Convex, Yearn, and StakeDAO competed to accumulate CRV and direct emissions to their preferred pools. Convex won decisively, accumulating more CRV than any other entity and becoming a kind of meta-governance layer for Curve. The whole dynamic was dizzyingly complex and became a case study in token-based governance in DeFi.
The near-death experience came in July 2023 when a Vyper compiler bug caused multiple Curve pools to be drained for $70 million. The exploit exposed an existential risk: Curve’s founder had personally taken out loans against CRV collateral, and a cascading liquidation of his position threatened to send CRV to zero and potentially bankrupt much of DeFi. A coordinated OTC rescue operation saw whales purchase Egorov’s CRV directly, preventing the crash. It was one of the stranger moments in DeFi history — a founder’s personal leverage nearly destroying a major protocol.
Curve survived. By 2024 it was again one of the largest stablecoin swap venues, had launched crvUSD (its own stablecoin), and had expanded to multiple chains. The protocol’s durability through multiple existential threats — exploits, founder risk, Curve wars drama — is itself a testament to how important its core function is. Stablecoin swaps are boring infrastructure, but somebody has to do them, and Curve still does it better than almost anyone else.
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