What Is Curve Finance? StableSwap, CRV and veCRV Explained

Curve Finance is a decentralised exchange (DEX) built for swapping assets that should trade at or near the same price, such as two dollar stablecoins or ETH and a liquid staking token. Its StableSwap design keeps prices almost flat around a 1:1 ratio, so large stablecoin trades move the price far less than they would on a standard AMM. Around that exchange sits CRV, the governance token, veCRV, the locked version that directs rewards, and crvUSD, Curve's own stablecoin.

As of 17 October 2026, Curve DEX held about $1.20 billion in total value locked, according to DefiLlama, down from a peak of about $24.3 billion in January 2022. This guide explains how the pieces fit together, what the 2023 Vyper exploit taught the market, and the risks to understand before you provide liquidity.

What is Curve Finance?

Curve is a set of smart contracts that hold pools of tokens and let anyone swap between them at a price set by a formula, with no order book. It is an automated market maker (AMM). Liquidity providers deposit tokens into a liquidity pool, receive LP tokens in return, and earn a share of the swap fees.

Curve was founded by Michael Egorov, a former co-founder and CTO of NuCypher, according to CoinMarketCap. Egorov published the StableSwap whitepaper on 10 November 2019, and the CRV token launched on Ethereum in August 2020, per Curve's documentation.

Ethereum still holds the large majority of Curve's liquidity: about $1.14 billion of the $1.20 billion total on 17 October 2026, per the DefiLlama API. The rest is spread across Arbitrum, Base, Fraxtal, Polygon, Optimism and many other EVM networks. Curve is not deployed on Sui, MultiversX or Radix.

The StableSwap invariant in plain words

Every AMM follows a rule, called an invariant, that links the balances in the pool to the price. Egorov's whitepaper starts from two simple rules and blends them.

• Constant sum (x + y = const). One token always swaps for exactly one of the other. There is zero slippage, but the pool can be fully drained of one side if the market price moves even slightly.
• Constant product (x × y = const). The Uniswap v2 rule. The pool never runs dry, but every trade moves the price, so swapping $1 million of stablecoins costs far more than it should for assets worth the same.

StableSwap behaves like constant sum while the pool is roughly balanced and bends towards constant product as it becomes lopsided. The whitepaper describes the result as "Uniswap with leverage". An amplification coefficient, usually written A, sets how flat the middle of the curve is. A high A means very low price impact near the peg; a low A behaves more like a normal AMM.

The trade-off is that the flat zone only works if the assets really do trade near 1:1. If one token in the pool loses its peg, arbitrageurs sell it into the pool, and liquidity providers end up holding mostly the weaker asset. That is why Curve pools are often the first place a stablecoin depeg shows up.

Cryptoswap pools for volatile pairs

In June 2021 Curve published a second design, Cryptoswap, for assets that do not hold a fixed ratio, such as a USD stablecoin against ETH, according to its whitepaper list. It concentrates liquidity around a moving internal price instead of a fixed 1:1 point. For a different approach to the same goal, see our guide to concentrated liquidity (CLMM).

CRV and veCRV: vote-escrow tokenomics

CRV has a fixed maximum supply of about 3.03 billion tokens. Allocations for the team, investors, employees and early users have fully unlocked, with the last team vesting finishing in August 2024, and the remaining community share is emitted to liquidity providers. Emissions fall by 16% each August, per Curve's CRV page.

CRV becomes useful when it is locked. Lock CRV for anywhere from one week to four years and you receive veCRV ("vote-escrowed CRV"). One CRV locked for four years gives 1 veCRV; locked for one year it gives 0.25 veCRV. Your balance decays linearly as the unlock date approaches, and veCRV cannot be transferred, according to the veCRV documentation.

veCRV gives three things:

• A share of protocol revenue. Part of the trading fees and part of the interest from crvUSD markets are converted to crvUSD and paid out weekly. The DAO switched the reward token from the 3CRV LP token to crvUSD on 20 June 2024, per Curve's revenue page.
• Boosted rewards. LPs who also hold veCRV earn more CRV on their deposits.
• Governance. veCRV votes on DAO proposals and on gauge weights.

Curve says it pioneered the vote-escrow model in 2020, and many protocols have since copied it. A governance token that has to be locked to earn anything rewards long-term holders, but it also concentrates power with whoever accumulates the most locked supply.

Gauges, Convex and the bribe market

Each week a fixed amount of new CRV is emitted. Where it goes is decided by gauge weights. A gauge is a contract that tracks LP deposits for one pool or lending market. veCRV holders split their votes across gauges, and a snapshot every Thursday at 00:00 UTC sets each gauge's share of that week's emissions. If a pool's gauge gets 10% of the votes, its stakers receive 10% of the week's CRV. You can change your vote on a given gauge once every 10 days, per the gauge weights guide.

Because votes steer real money, they became valuable in their own right. Two things followed:

• Liquid lockers. Protocols such as Convex lock CRV permanently on behalf of users and issue a liquid token in return. Convex says it lets Curve LPs "claim boosted CRV without locking CRV themselves", according to its documentation. Curve's own docs list cvxCRV, sdCRV and yCRV as derivatives of veCRV.
• Bribes. Projects that want deep liquidity for their token pay veCRV holders, or holders of liquid-locker governance tokens, to vote for their gauge. If a week of votes costs less than the CRV emissions it attracts, buying votes is cheaper than paying LPs directly.

This system is often called the "Curve wars". We cover how the same mechanics have spread to liquid staking in the gauge bribe economy.

crvUSD and LLAMMA

crvUSD is Curve's crypto-backed, over-collateralised stablecoin. Curve deployed its contracts on Ethereum on 3 May 2023, initially with a 20 million crvUSD mint cap and Frax Ether as the first collateral, according to The Block. You get crvUSD by borrowing it against crypto collateral such as ETH or BTC, or by buying it. As of 17 October 2026, about $241 million was in circulation, per DefiLlama's stablecoin data.

What makes crvUSD different is LLAMMA, the Lending-Liquidating AMM Algorithm. Most lending protocols have one liquidation price: cross it and part of your collateral is sold at once. LLAMMA instead spreads your collateral across a range of price "bands". As the price falls into your range, an internal AMM gradually converts collateral into crvUSD. If the price recovers, it converts back. Curve calls this soft liquidation, per its LLAMMA explainer.

Soft liquidation is not free. Each conversion loses a little value, and if the price keeps falling, or the loan's health drops too far, the position is still hard-liquidated. Curve's docs note that the conversions "incur losses and can still end in full liquidation". The same engine powers LlamaLend, Curve's isolated lending markets. Curve says v1 markets are being phased out and new markets must use LlamaLend v2, which supports any ERC-20 pair, per the LlamaLend overview. For how a single liquidation threshold works elsewhere, see our health factor guide.

The July 2023 Vyper exploit

On 30 July 2023 the maintainers of Vyper, the smart contract language Curve's pools are written in, disclosed that compiler versions 0.2.15, 0.2.16 and 0.3.0 had broken reentrancy locks. Attackers used the bug to re-enter pools while a withdrawal was still in progress. The hit pools included JPEG'd's pETH/ETH, Alchemix's alETH/ETH, Metronome's msETH/ETH and Curve's own CRV/ETH pool.

CertiK estimated that about $69.3 million was taken, of which $16.7 million was returned by white-hat hackers, leaving a net loss of about $52 million, according to its incident analysis. Final figures differ slightly between sources because of later recoveries.

The lesson was not that StableSwap maths failed. The pool logic was fine; the compiler that turned it into bytecode was not. Audits that only read source code could not catch it. That is a useful reminder when you assess any protocol: risk sits in the code, the compiler, the oracles and the admin keys, not only in the economic design.

Risks of using Curve

• Depeg risk. In a stable pool you hold a mix of the pooled assets. If one depegs, the pool fills up with it, and you take the loss.
• Impermanent loss. Small in stable pools while the peg holds; real in Cryptoswap pools with volatile assets.
• Smart contract and compiler risk. The 2023 exploit shows bugs can sit below the protocol layer.
• Emission and governance risk. Much of the yield in many pools comes from CRV emissions and bribes, which shrink as emissions fall and vote prices change.
• Liquidation risk on crvUSD and LlamaLend. Soft liquidation slows losses but does not remove them.

Where JewelSwap fits

JewelSwap does not run on Curve. It operates on MultiversX, Sui and Radix, where it offers liquid staking (JWLEGLD, JWLSUI and JWLXRD) and yield farms. Two Curve ideas appear in its products: boosted farming on MultiversX uses AshSwap's veASH vote-escrow token, and JewelSwap Gauge uses voting to decide how staked EGLD is delegated across validators. To compare the DEX landscape on Sui, see our Sui DEX comparison.

Frequently asked questions

What is Curve Finance used for?

Curve is mainly used to swap assets that should trade near the same price, such as USDC and USDT or ETH and a liquid staking token, with low slippage. Liquidity providers deposit into its pools to earn swap fees and CRV rewards, and borrowers can mint crvUSD against crypto collateral.

What is the CRV token?

CRV is Curve's governance and reward token, with a fixed maximum supply of about 3.03 billion. New CRV is emitted to liquidity providers each week, and emissions fall by 16% every August. Locking CRV gives veCRV, which carries voting power and a share of protocol revenue.

What is veCRV?

veCRV, or vote-escrowed CRV, is what you receive when you lock CRV for between one week and four years. Longer locks give more veCRV, the balance decays as the unlock date nears, and it cannot be transferred. It earns a share of fees, boosts LP rewards and votes on gauge weights.

How is StableSwap different from Uniswap?

Uniswap v2 uses a constant-product formula, so every trade moves the price. StableSwap behaves like a constant-sum formula while the pool is balanced, keeping the price nearly flat around 1:1, and only curves sharply when the pool becomes lopsided. That makes large stablecoin swaps much cheaper.

Was Curve hacked?

In July 2023 a bug in Vyper compiler versions 0.2.15, 0.2.16 and 0.3.0 broke reentrancy locks, and several Curve pools were drained. CertiK estimated about $69.3 million was taken and $16.7 million returned, leaving roughly $52 million lost. The flaw was in the compiler, not the StableSwap formula.

Is crvUSD safe?

crvUSD is over-collateralised by crypto assets and uses LLAMMA to liquidate positions gradually. That reduces sudden liquidations but does not remove smart contract, collateral price or depeg risk, and soft liquidation itself causes losses. Treat it like any other crypto-backed stablecoin.

Keep reading

• What is an automated market maker (AMM)?
• The gauge bribe economy in liquid staking
• Impermanent loss explained
• Concentrated liquidity (CLMM) explained
• What is Wrapped Bitcoin (WBTC)?

This article is educational and is not financial advice. TVL, supply and volume figures are as of 17 October 2026 from DefiLlama and Curve documentation, and they change daily. Sources are linked inline.