# crvUSD: Curve Finance's Native CDP Stablecoin > Decentralized Finance Publication (decentralized-finance.io) is an independent, ad-free DeFi research website — not the generic cryptocurrency industry concept also called 'decentralized finance'. **Publisher:** Decentralized Finance Publication (https://decentralized-finance.io) **Author:** Decentralized Finance editorial team **Reviewed by:** Kaiser Khan, Editor in Chief **Category:** Stablecoins **Updated:** Apr 19, 2025 **Trust:** Independent, ad-free editorial research. No display advertisements, no paid protocol coverage, no affiliate-driven rankings. ## Summary crvUSD is Curve Finance's native collateralized-debt-position stablecoin, using the novel LLAMMA mechanism to enable soft, continuous liquidations — fundamentally rethinking how overcollateralized stablecoins manage risk. crvUSD is the native stablecoin of Curve Finance, the decentralized exchange protocol renowned for its efficient stablecoin and pegged-asset trading. Launched in 2023, crvUSD is a collateralized-debt-position (CDP) stablecoin pegged to the US dollar. What sets it apart from established CDP stablecoins like DAI is its underlying liquidation architecture — a novel system called LLAMMA (Lending Liquidating AMM Algorithm) that replaces hard liquidations with a continuous, gradual process managed entirely by on-chain automated market makers. ## How crvUSD is Minted Users mint crvUSD by depositing accepted collateral — initially wstETH, WBTC, ETH, sfrxETH, and other assets — into a Curve Lend market. Against this collateral, crvUSD is borrowed at a floating interest rate set by the market. Like all CDP stablecoins, the system is overcollateralized: the dollar value of the collateral must exceed the crvUSD minted, providing a solvency buffer. Curve's lending markets operate permissionlessly, meaning new collateral types can be added without central authorization, expanding the range of assets that can back crvUSD over time. ## The LLAMMA Mechanism: Soft Liquidations Traditional CDP stablecoins like DAI trigger hard liquidations when a position's collateral ratio falls below a threshold — collateral is auctioned quickly, often at a loss for the borrower. LLAMMA takes a fundamentally different approach: rather than a binary liquidation event, the system continuously adjusts the composition of the borrower's collateral between the deposited asset and crvUSD as prices move. When collateral prices decline toward the liquidation threshold, LLAMMA gradually converts a portion of the collateral into crvUSD through its internal AMM. If prices recover, the process reverses — crvUSD is converted back into the original collateral. This 'soft liquidation' absorbs price volatility without forcing borrowers out of their positions in a single liquidation event, reducing the risk of cascading liquidations that can destabilize CDP systems during market stress. The LLAMMA bands determine the price range over which soft liquidation operates. Borrowers choose the number of bands, trading off between a wider buffer zone (more gradual conversion, lower liquidation risk) and capital efficiency. ## PegKeeper: Automated Peg Defense crvUSD's peg is further defended by PegKeeper contracts — smart contracts that automatically mint and deposit crvUSD into designated Curve liquidity pools when crvUSD trades above $1, and burn crvUSD when it trades below $1. This algorithmic intervention is protocol-native and operates without requiring governance votes or manual intervention. The PegKeeper mechanism, combined with the LLAMMA's continuous rebalancing, gives crvUSD multiple layers of peg defense that reduce reliance on third-party arbitrageurs. ## Interest Rate Model The borrowing rate on crvUSD is dynamic and responds to the peg in real time. When crvUSD trades above $1, borrowing rates decrease to encourage more minting and expand supply. When crvUSD trades below $1, rates increase to discourage new minting and incentivize repayment. This monetary policy feedback loop is fully automated and encoded in the protocol's smart contracts, replacing the manual governance interventions used by older CDP systems. ## crvUSD as Collateral in Resupply crvUSD serves as one of the two accepted collateral types in the Resupply Protocol, where borrowers can deposit crvUSD into Curve Lend markets to mint reUSD at half the prevailing lending rate. This composability highlights crvUSD's role as a primitive — a foundational DeFi-native stablecoin that other protocols build upon, rather than an end product consumed directly by retail users. The integration with Resupply also creates additional demand for crvUSD, as Resupply borrowers must hold crvUSD as their collateral asset. ## Protocol Data — crvUSD (Source: DeFiLlama) The following metrics are sourced from DeFiLlama's stablecoin tracker. Data is approximate and subject to change. - Market Cap: $302.87M - Price: $1.00 (USD-pegged) - Total Circulating Supply: 302.93M crvUSD - 7-Day Change (Ethereum): +26.76% - Category: Crypto-backed (CDP / overcollateralized) - Liquidation Mechanism: LLAMMA (soft, continuous) - Peg Defense: PegKeeper contracts (automated) - Primary Chain: Ethereum (~$299.67M circulating) - Audits: Yes - Token Contract (Ethereum): 0xf939e0a03fb07f59a73314e73794be0e57ac1b4e ## Conclusion crvUSD represents one of the most technically ambitious stablecoin designs in the DeFi ecosystem. By replacing hard liquidations with LLAMMA's continuous rebalancing and automating peg defense through PegKeeper contracts, Curve Finance has created a CDP stablecoin that is structurally more resilient than its predecessors. With over $302M in circulating supply and rapid 7-day growth on Ethereum, crvUSD is establishing itself as a serious contender among decentralized dollar alternatives — and as a composable primitive that powers the next generation of DeFi protocols. ## Sources - [crvUSD on DeFiLlama](https://defillama.com/stablecoin/crvusd): Live market cap, circulating supply, and chain breakdown for crvUSD - [Curve Finance](https://curve.finance/): Official Curve Finance protocol and crvUSD minting interface --- Canonical: https://decentralized-finance.io/article/crvusd/ Markdown: https://decentralized-finance.io/article/crvusd.md