Convex, Curve and Resupply: The Complete Guide to DeFi's Yield Flywheel

Curve, Convex and Resupply are wired together so tightly that you cannot properly understand any one of them alone — and the way they fit is some of the most elegant mechanism design in DeFi. Curve issues the emissions. Convex controls where they go. Resupply, built jointly by Convex and Yearn, turns the resulting yield-bearing positions into borrowable dollars without ever switching the yield off. Capital entering at any point strengthens the other two, which is why this is a genuine flywheel rather than a set of integrations.

This guide covers the whole loop end to end: what each protocol contributes, how the mechanism works, why the economics are self-sustaining rather than subsidised, what participating actually involves, and what to watch. It is written for someone deciding whether to put capital in, so it is specific about both the opportunity and the risk — the two things a feature list never gives you.

Part 1: The four protocols in one paragraph each

Before the mechanism makes sense, you need the pieces. Three protocols form the loop itself, and a fourth — Yearn — co-built the protocol that closes it. Each has a full guide on this site; what follows is the minimum needed to follow the mechanism.

Part 2: How the flywheel actually turns

The loop has five stages. Each one creates the condition the next one needs, which is what makes it self-reinforcing rather than merely well-integrated.

The five stages, in order

1. 1

   Curve emits CRV to whichever pools its voters choose

   Curve pays liquidity providers in CRV. How much any given pool receives is decided by gauge weight votes, and voting power comes from CRV locked as veCRV — up to four years, with longer locks carrying more weight. The vote is therefore the valuable thing, not the token itself.

2. 2

   Convex turns that vote into a service

   Locking CRV for four years is a serious commitment most depositors will not make, which leaves their rewards unboosted. Convex locks on their behalf: it accumulates CRV, locks it permanently as veCRV, and passes the maximum boost to anyone who deposits through it. Depositors get boosted yield with no lockup; Convex accumulates one of the largest veCRV positions in DeFi.

3. 3

   Resupply accepts the boosted position as collateral

   Deposit crvUSD into Curve Lend, or frxUSD into Fraxlend, and you hold a position that earns lending interest plus Convex-boosted CRV and CVX. Resupply takes that position as collateral and mints reUSD against it — and critically, the collateral keeps earning the whole time the loan is open.

4. 4

   Borrowers get positive carry

   Resupply sets the borrow rate as a fraction of the collateral's own yield — the design targets roughly half. If the collateral earns 10% and the borrow rate is 5%, the position is net positive before you have done anything with the borrowed reUSD. That is the structural claim the protocol is built on, and it is unusual: most CDP designs charge you for the privilege of borrowing against an idle asset.

5. 5

   The borrowed dollars flow back into the pools

   reUSD is most useful inside the same ecosystem — providing liquidity, looping into more collateral, or trading against the Curve pools it was born from. That deepens the pools, which makes them more attractive to route emissions toward, which brings the loop back to stage one.

Why Convex and Yearn built Resupply together

Resupply is not a third-party protocol that happened to integrate with the other two. It was announced in December 2024 and launched on Ethereum mainnet on 20 March 2025 as a joint subDAO of Convex Finance and Yearn Finance — two of the longest-running teams in DeFi building something together rather than competing.

The split of contributions is what makes the design work. Convex brings the veCRV bloc and the boost infrastructure, which is what makes the collateral yield high enough to lend against in the first place. Yearn brings vault architecture and yield strategy design — the discipline of making a yield-bearing position behave predictably enough that a lending protocol can price it, liquidate it and account for it safely.

That second half is easy to underrate. Plenty of protocols can accept a yield-bearing token as collateral; far fewer can do it without the yield mechanism itself becoming the attack surface. Yearn has been solving exactly that problem since 2020, and Resupply is a direct application of it: collateral that compounds while it secures a loan, engineered by the team that made compounding vaults a standard DeFi primitive.

For anyone assessing counterparty quality, this matters more than most factors on the list. Resupply launched with the governance, engineering and treasury backing of two established DAOs rather than an anonymous team and a fresh multisig.

Part 3: Why the economics hold together

Plenty of projects draw a flywheel. What makes this one real is that every participant has a reason to keep it turning that does not depend on any token price going up — the incentives are structural, not promotional.

Curve wants deep, sticky liquidity and gets it because emissions are directed by people with a four-year time horizon. Convex wants CRV to stay locked and gets a permanent revenue share for providing the service. Resupply wants collateral that generates its own yield, because that is what allows the borrow rate to sit below it. Borrowers want leverage that does not bleed, and positive carry is exactly that.

The mechanism that ties it all together is the vote market. Because veCRV decides where emissions land, and Convex holds a large bloc of it, the right to direct that bloc has a market price. vlCVX holders vote, and third parties pay them to vote a particular way — this is the bribe or incentive market, and it is the reason a CVX lock produces income beyond the protocol's own fee share.

What positive carry means with actual numbers

The clearest way to see the design is to run a position through it. The figures below are illustrative and chosen so the arithmetic is checkable — they are not current rates, which move constantly.

Part 4: What the numbers say right now

The three protocols sit at very different points in their lifecycle, and being precise about that is more useful than treating them as equals.

Curve is mature infrastructure with over a billion dollars of TVL. Convex sits in the hundreds of millions and is best understood as a governance position — one of the largest veCRV blocs in existence. Resupply is the newest and smallest at tens of millions, and it has been growing through a stretch in which both Curve and Convex contracted, which is a more interesting signal than its absolute size. reUSD has also held its peg tightly, which for a stablecoin barely a year old is the metric that matters most.

Resupply Summer and what it changes

In August 2026 Convex committed to a multi-round rewards campaign for Resupply, branded Resupply Summer. The structure is escalating rounds of RSUP emissions and CVX bonuses for collateral providers and borrowers, with veCRV gauge support behind the related Curve pools.

It is working. In the week following the launch, Resupply's TVL rose by a low single-digit percentage while Curve and Convex both went the other way — a genuinely good result for a campaign of this size, and a more meaningful signal than any headline reward rate. Convex committing multi-round rewards to a protocol it co-built is also a real vote of confidence, since it is spending its own emissions to do it.

The test any incentive programme faces is whether deposits stay once emissions stop. Resupply is better placed than most on that question, because the underlying position pays whether or not a campaign is running — the positive carry is the product, and the rewards are on top of it.

Part 5: How to participate, step by step

If the mechanism makes sense and the risks below are acceptable to you, this is the practical sequence. Nothing here is a recommendation to do it — it is a description of what doing it involves.

1. 1

   Decide which end of the loop you want exposure to

   Providing liquidity through Convex is the lowest-complexity entry: boosted rewards, no lockup, no debt. Minting reUSD adds leverage and liquidation risk. Locking CVX is a governance position with a multi-week lockup and a different risk profile again. These are three different products, not three depths of the same one.

2. 2

   Build the collateral position first

   Supply crvUSD to Curve Lend, or frxUSD to Fraxlend, and hold the position through Convex so it earns the boosted rate. At this stage you have yield and no debt, and you can stop here.

3. 3

   Check the live rates before borrowing, not after

   The positive-carry claim depends on the borrow rate sitting below the collateral yield. Both move. Verify the actual spread on the day rather than assuming the design target holds — if the spread has inverted, the position is costing you money.

4. 4

   Mint reUSD well below the maximum

   The interface will let you borrow to the limit. The limit is the liquidation boundary, not a recommendation. Leaving meaningful headroom is the difference between surviving an ordinary market move and being liquidated during one.

5. 5

   Decide deliberately whether to loop

   Using borrowed reUSD to buy more collateral and repeating multiplies both the carry and the liquidation risk. Each loop tightens the margin for error. Most losses in positive-carry designs come from leverage stacked on top of a sound base position, not from the base position itself.

6. 6

   Monitor the health factor, not just the price

   Liquidation is automatic and bots act within seconds. Set your own alert well above the liquidation threshold, because by the time you notice manually it has usually already happened.

Part 6: What can go wrong

Anyone putting capital in should know what they are underwriting. The flywheel is well built, and every stage still introduces a dependency — a loop that reinforces itself in one direction can unwind in the other, so these are the things worth monitoring.

Smart contract risk is the one that is never zero anywhere in DeFi. Resupply had an incident in June 2025 affecting a newly deployed market, covered in full in our Resupply Finance guide; the Insurance Pool absorbed it as designed and the treasury and partners contributed to the recovery. Convex and Curve have both run without a major exploit since 2021 and 2020 respectively.

Part 7: Where to read further

This page is the map. Each protocol has a full guide, and the mechanisms referenced above have their own explanations.

• Protocol guides: our Convex Finance overview covers CVX, cvxCRV and vlCVX; the Resupply Finance guide covers reUSD, RSUP and the CDP mechanics; the Curve guide covers crvUSD and Curve Lend.
• Head to head: Aave vs Resupply compares general-purpose lending against yield-bearing collateral at decentralized-finance.io/compare/aave-vs-resupply/
• Mechanisms: see our glossary for veTokenomics, gauge, CDP, real yield, liquidation and health factor — each with a worked example.
• Live data: TVL rankings at decentralized-finance.io/research/top-defi-protocols-by-tvl/ and the tools page for lending rates and stablecoin peg monitoring.