Curve Deploys Smart Contracts for Llama Lend Lending Platform

Developers of the decentralized exchange Curve Finance have deployed smart contracts for the Llama Lend lending platform, as reported to ForkLog by project representatives.

Currently, the user interface of Llama Lend is unavailable, as this is not an official launch but rather a real-world testing phase. In the future, the Curve team may redeploy the contracts similarly to the CDP-stablecoin crvUSD.

The platform allows any user to create an isolated lending vault with a mechanism of soft-liquidations and de-liquidations, which is utilized in crvUSD.

If the collateral value decreases, the loan automatically enters a soft-liquidation mode, where part of the collateral is converted into crvUSD. Conversely, if the collateral value increases, the system de-liquidates it, converting crvUSD back into the collateral token.

“The crvUSD ecosystem needs not only borrowers but also holders. To expand the stablecoin market, we launched the Llama Lend platform, where any collateral, including crvUSD, can be used, not just major cryptocurrencies,” commented Curve Finance founder Mikhail Egorov.

Additionally, the soft-liquidation mechanism maximizes the LTV ratio. For wstETH collateral, it is 89%, and for CRV collateral, it is 83%.

“Unlike typical lending platforms that instantly liquidate collateral when prices fall, Curve gradually sells off and repurchases it when prices rise. This allows one to weather significant price drops from a week to a year or longer, depending on risk tolerance,” added Egorov.

Earlier, the venture arm of the cryptocurrency exchange Binance invested $5 million in Curve DAO (CRV) tokens.