According to data from Lookonchain, Egorov used 68 million CRV (worth $35.3 million) as collateral on the decentralized lending platform Silo. This allowed him to borrow the stablecoin crvUSD from Curve. He then exchanged crvUSD for Tether’s USDT stablecoin, effectively settling his debt on Aave.
In the past two days, Egorov has borrowed 10.8 million worth of crvUSD on Silo. Currently, he holds 253.7 million CRV (worth $132 million) as collateral.
His remaining debt is spread across different protocols, including 10 million DOLA ($10 million) on Inverse, 13.1 million FRAX ($13.1 million) on Fraxlend, $2.5 million in USDC and USDT debt on Cream, and the most recent 17.1 million crvUSD ($17.1 million) on Silo.
Curve Founder Michael Egorov Addresses $100 Million Debt Crisis and DeFi Market Concerns
In August, Egorov made headlines for accumulating a debt of $100 million across various DeFi protocols, backed by over 400 million CRV tokens. This raised concerns about the potential impact on the price of CRV and the overall DeFi market. To mitigate this risk, Egorov has been actively reducing his debt and utilization rate.
Egorov started taking loans on Aave in April, using 288.7 million CRV tokens (worth $173 million) as collateral to secure a loan of approximately $64 million. The collateral represented 34% of the total CRV token supply.
In July, Curve experienced a hack that exploited a vulnerability, resulting in funds being stolen from some liquidity pools. The hack affected its JPEG’d, Alchemix, Pendle, and Metronome pools. Initially estimated at around $70 million, subsequent reports suggested that white hat hackers intervened and reduced the loss to approximately $50 million.
The hack had a significant negative impact on the market, causing CRV prices to drop by over 12%. As a major player in DeFi, this hack and price crash had implications for Egorov’s loan position on Aave and other protocols, potentially risking liquidation.
Michael Egorov Sells 106 Million CRV Through OTC Deals, CRV Aims for Positive Market Momentum
To address his outstanding debt on multiple DeFi platforms, Egorov executed a deal to sell 106 million CRV tokens, generating $46 million in proceeds.
This triggered a series of over-the-counter (OTC) deals where CRV tokens were exchanged for stablecoins. Notable buyers included Wintermute, Justin Sun, the founder of Tron, and Jeffrey Huang, an NFT investor. The largest OTC deal, involving 17.5 million CRV tokens, was made by an anonymous entity.
While Curve DAO has shown steady growth in recent years, it now faces increased competition in the market. Although it remains one of the fastest-growing DAO-based projects with real-world applications, its growth rate has slowed down this year.
The price of CRV experienced a surge earlier in 2021 during the bull run, but has since stabilized. After the security breach, the value of CRV dropped by 30%, going from $0.73 on July 30 to $0.50 on August 1, according to CoinMarketCap. Currently, the token is trading at $0.5176 with a market capitalization of $455 million. With the announcement of partnerships, projects, and the repayment of debt, an upward trend in price can be expected.