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DeFi Exchange Curve’s Stablecoin Pool Falls Out Of Balance

A well-known infrastructure backing stablecoin-related trade on Curve (a decentralized exchange) is witnessing an imbalance. This is so as the 3pool’s tokens could get influenced by an abrupt decline of Silicon Valley Bank. The fears regarding this are rising to a great extent. 3pool of Curve is a liquidity pool and has a valuation of up to $510 million.

Curve’s 3pool Witnesses a Hard Time as Traders Leave USDC

The tokens contained in this pool take into account USDT, DAI, and USDC. It is considered that the respective pool keeps nearly equal balances for each of these assets. However, the reports have pointed out that the USDT balance of the pool had slumped to less than just seven percent while a 46% drop has been seen by both DAI and USDC.

The imbalance indicates that the crypto investors are rapidly leaving the assets that are associated with the USDC stablecoin of Circle. In addition to this, the DAI token is also partially supported by USDC. Such fears are ignited by some speculations. It is thought that a part of the cash reserves at USDC, including those which are devoted to supporting USDC, may get held in crashed Silicon Valley Bank.

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Circle has formerly stated that the platform keeps up to $43B value of reserves at SVB. Recently, the federal regulatory authorities seized the deposits of the lender as the situation worsened. The position of Silicon Valley Bank is that of the 2nd-biggest banking institution that has seen a collapse. Precisely, since 2008’s financial crisis, this incident counts as the 1st of its kind.

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Andrew Thurman, the research head at Nansen (a data company) stated that the pools at curve have gained a lot of popularity among investors in terms of stablecoins. According to him, these pools additionally play a significant structural role to maintain on-chain pegs. On the other hand, he added, an imbalanced pool may become a cause of the exacerbated liquidity woes, apart from panics.

Subin An, who is a data analyst serving at a crypto fund named Hashed, also commented on this scenario. As per Subin, keeping in view the numbers, USDT token has never been held in such a minor relative share at 3pool. On the other hand, the reports bring to the front that a DEX altcoin has resisted the market downturn by showing an elevation of up to 20% on Friday.

The DEX Altcoin ‘KWENTA’ Endures Crypto Downturn

The altcoin named Kwenta belongs to a derivatives decentralized exchange platform that provides exposure to on-chain synthetic tokens as well as real-world assets with the use of the Synthetix protocol. KWENTA is the local token of the exchange and it rose from a low price level of just $400.96 (as of March 10) to its present position of nearly $609.05.

This huge jump denotes an elevation of more than 51%. The crypto asset is ranked in 262nd position in terms of market capitalization. It saw an all-time high price of almost $680.80 only 4 days back. The token is utilized for purposes related to governance and staking. It has witnessed a jump of nearly 373% since the year’s start.

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The price upsurge takes place at a time when the company sees an increase in its trading volume. Moreover, the decentralized exchange (DEX) remained successful in processing above $102M worth in terms of trading volume just on Thursday.


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Mubashar Nawaz (United Arab Emirates)

Mubashar Nawaz is an experienced crypto writer working for Tokenhell. Having passion for writing, he covers news articles from blockchain to cryptocurrency.

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