Curve Finance Allocates Admin Fee of $3 Million to Governance Token Holders

One of the most prominent decentralized finance (DeFi) projects of 2020, Curve Finance has confirmed that it will be making a payout to its token holders worth $3 million. The decentralized exchange (DEX) platform had a week-long voting period for reaching a consensus regarding the allocation of its administration fees. According to the voting log, the process ended up favoring the holders of their governance tokens. Therefore, a total of $2.6 million in fees will be paid to these token holders, which had been accrued before the voting process had begun. Michael Egorov, the chief executive of Curve Finance, said that the funds will be dispersed after the initial payout on a weekly basis. 

The decentralized exchange (DEX) platform has been one of the notable participants in this year’s rally of decentralized finance. According to the data provided by DeFi pulse, currently, Curve Finance is the sixth-largest DeFi protocol in the market, and the total locked assets in it are $884 million. However, the focus of the service on decentralization is a major reason behind its rather impressive run. Curve decided to hold the vote about the allocation of admin fees because it wants to give a voice to all community members.

In order to vote, users are required to stake CRV tokens to the platform’s voting contract and they will be supplied with veCRV. So far, half of all Curve’s trading fees have gone to veCRV whereas the liquidity providers have taken the remaining half. Now that the fee distribution mechanism has been sorted out by Curve, the service is now free to fully focus on maintaining its price rally. This year, the DeFi market has seen a lot of activity, as there was a major uptick in user numbers of different protocols. The market saw a bit of a drop in the previous month, as a number of DeFi tokens saw their value drop, and the value of total assets locked also fell. 

However, the metrics have not wavered much and are quite strong. Dune Analytics provided data, which showed that there has been a 1,000% increase in the number of DeFi user addresses in the last year, as they have now reached 860,000. Even when the DeFi rally had come to a halt in October, the user numbers had gone up, as the data provided by Dune Analytics showed that there was a 40% surge in users in the month with the number went from 555,000 to 755,000. 

DEX Dydx and lending protocol Compound were the two that were the strongest gainers. Both saw their user numbers increase by 50% and 250% respectively in the last month. Even though Compound is no longer the top lending protocol in the industry, as the position has been taken up by Maker, but its user growth by 135,000 does show that it could once again make a run for the top spot. As far as Curve is concerned, it still has to deal with Uniswap in the lead for decentralized exchanges.

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