The Aave community has approved the proposal to prohibit additional CRV borrowing, with a 100% support rate. The risk management firm Gauntlet proposes the Aave community block Curve DAO Token (CRV) borrowing to prevent the liquidation risk of Curve Finance founder Michael Egorov’s debt that could trigger a contagion and possibly a DeFi crash.
Gauntlet has been looking into the risk profile of Curve Finance founder Michael Egorov. The account borrows roughly $54 million of USDT against $158 million of CRV. However, Egorov is quickly paying off his $80 million debt through OTC sales of CRV tokens. Currently, a loan of roughly $29 million of USDT against $116 million of CRV on Aave is pending.
Curve Finance pools suffered a $61 million hack last week. While the hacker has started to return funds, the DeFi platform decides to drag the exploiter to court as the deadline for the voluntary return of funds has passed.
Meanwhile, Curve Finance founder Michael Egorov is almost halfway to paying off his $80 million debt through OTC sales of CRV tokens. As a result, the CRV token price jumped 10% on Saturday.
CRV price fell 0.50% in the past 24 hours and 5% in a week, with the price currently trading at $0.61. The 24-hour low and high are $0.608 and $0.619, respectively.
The price witnessed recovery but the momentum is now weak. The trading volume also fell 70% in the last 24 hours, indicating a lack of interest from investors.